SECOND-time househunters looking to make the move to a larger home are finding it increasingly difficult to secure a suitable property, according to estate agents.
The National Association of Estate Agents (NAEA) found that properties for sale in its members’ branches decreased slightly in August, from 61 to 60, and this is only part of the challenge for those looking to upgrade to a larger property. A recent Lloyds TSB report found that would-be second-steppers now have just over £9,000 in equity on average*, meaning the struggle to raise a sufficient deposit is no longer confined to first time buyers.
Mark Hayward, President of the NAEA, said: “Many would-be ‘second-steppers’ are finding they are still hamstrung by high deposits and prohibitive lending conditions.
“Across the board, house prices are fairly flat, and this means that many owner-occupiers are unable to withdraw additional equity from their property when they decide to move.”
The NAEA has the following advice for those looking to move into their second property:
Realism pays. Setting a realistic price, based on current market conditions, gives your home the best chance of being sold within a reasonable time frame. Once a figure is agreed with your agent, this price will give you an idea of what you will have to spend on your next property. If you haven’t been in the property market for some time, be sure to talk to your bank to find out how much you can borrow to further guide your property search.
Be aware of house price micro-markets: Although there are broad national housing market trends, there is always a lot of local variation, which can help you find a bargain. A good local NAEA agent can help you identify trends in certain areas and offer advice on how much you should expect to spend.
Factor in ‘hidden’ cost: Remember to consider the cost of moving, agent fees and the additional stamp duty before you start the process of looking for your next property. Stamp duty is not usually factored in to the mortgage, so it is important for these costs to be taken into account before settling on your target price range.
Know where you are prepared to compromise: Agree a short list of ‘must haves’ and supplement this with ‘desirables’. This process should help bring out what is essential for your new home and can help guide the selection process.
Maximise the sale value of your home: At a cosmetic level, applying a fresh coat of paint to rooms and lounge space can really help to spruce up the property. Clearing the approach can also give a better initial impression and boost ‘kerb appeal’. Finally, emptying rooms and storage spaces of unnecessary clutter can help to create a better sense of space throughout any property.