27 Jan

Homeowners enjoying strong equity position

Homeowners enjoying strong equity position

Many homeowners are benefiting from the rise in first-time buyers and opting to upscale their property, according to new figures.

Lloyds Bank data revealed a sharp increase in so-called 'second-steppers' in 2014 as people capitalised on the extra demand for their homes.

Last year, the number of people moving home reached a seven-year high and an eight per cent rise on 2013 levels.

In total, 365,400 property owners purchased a new home partially funded by a mortgage, with many seeing equity rise because of the influx of first-time buyers to the market.

Government schemes such as Help to Buy have also played a key part in increasing the availability of low deposit mortgages for people trying to take their first step on the property ladder.  

According to Lloyds more potential second steppers are now enjoying around £10,000 more equity in their home than they were a year ago. This is largely due to the increase in prices paid for first-time buyer properties.

The average second-steppers has an estimated £76,131-worth of equity in their existing home, which could give them a 25 per cent deposit to put towards their next property.

Andy Hulme, Lloyds Bank mortgages director, said: "House price rises over the past 12 months have enabled more home owners to make the next move onto the housing ladder.

"The resulting higher levels of equity in their property are providing home owners with more funds to finance the purchase of their next home."

He added an ongoing rise in property values this year could allow many people who purchased their first home at the height of the housing boom to make the next move in the near future.ADNFCR-1222-ID-801772066-ADNFCR

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