Second-time buyers suffer in search of property success
The research undertaken by Lloyds Bank was based on 525 interviews, conducted in December 2016 right across the UK, with first-time buyers looking to purchase their next home.
Due to the challenges faced by second-time buyers almost a quarter (23%) said they’ll have children later in life than they had originally planned with 12% also saying they will have fewer children. Some also said they had to change career (13%) as a result of their challenge to move up in the housing market.
Rising moving costs, Stamp Duty and the difficulty in finding the right property has meant that more than half (52%) of those still living in their first home said they had planned on moving up the property ladder in the last 12 months but have been unable to do so.
Low savings rates have also been a contributing factor and second-time buyers stated that it’s taken longer for them to save enough to take the next move. However, there are also challenges on the demand side, as they also reported it’s harder to sell their current property now compared to 12 months ago (39%).
The rise in house prices is helping, however, with 39% of those buying for a second time saying it will help them to sell their current property for the right price.
In the event that a second-time buyer is unable to sell their current property, 9% said they would consider lowering their asking price to attract interest. It seems that more are willing to remain in their current property to either wait until conditions allow a move (51%) or make improvements to their current home (27%). Just over a fifth (21%) stated they would look to rent their property instead and still move.
Andrew Mason, mortgage product director at Lloyds Bank, said: “Moving up the property ladder has become more challenging for ‘second steppers’ in recent years. The rise in house prices and moving costs, along with how difficult it is to find the right property means they’ve had to wait longer than anticipated or even put off their move entirely until the right property comes along.
“They seem to be very clear on what they want from their next property and will stay put and improve their current home rather than make any sacrifices. Our research also shows that most homeowners think ahead and understand that it could take up to four moves in total to reach their ‘dream’ home.”
A driveway is the most important feature that second-time buyers said their next home must have. Having a garden and a kitchen/diner also made the top three.
When asked what type of property second-time buyers want to purchase, they typically said they wanted either a period (35%) or new build (34%) property in town with three bedrooms.
The majority realise that their next home won’t be their final home with the average amount of time prospective second-time buyers plan to stay in their next property being 10 years. Only a third (31%) said they don’t plan to move again once they’ve taken the second step.
Unsurprisingly, the most common reason second-time buyers consider a move is due to their current property being too small. Location is the next most important element at 27% and 11% also said they want more garden space. Living close to transport links is lowest on the list with only 1% highlighting this as a priority.
Two thirds changed their reasons for moving since initially considering their next move. Having to accommodate a growing family, being close to a good performing school (20%) and looking for a more ‘long-term’ home (15%) became bigger priorities once second-time buyers gave greater consideration to the move.