Age at which struggling first-time buyers can finally trade up rises to 40

 

The average age at which first-time home buyers trade up to a new property has risen to 40 – with younger owners trapped in homes they purchased before the recession of 2007.

Figures also show that the number of approved home-owner mortgages dropped by 2 per cent in the first half of this year, despite those joining the housing ladder rising by a fifth – suggesting that government initiatives such as Help to Buy have increased the number of first-time buyers but young families are still struggling to move into bigger properties.

The data follows comments from Mark Carney, the Bank of England Governor, that he could use the new powers of the Bank’s Financial Policy Committee to curb surging house prices and uncontrollable mortgage lending in an attempt to stave off a housing bubble.

Mr Carney said he witnessed the “boom-bust cycle” first-hand while living in Britain during the 1990s and was “very alert to the damage it could do”. In an interview with the Daily Mail, he said the Bank would assess “emerging vulnerabilities” and could ask lenders to restrict borrowing terms or even force banks to hold more cash on their balance sheets to dampen down an overheated market.

Meanwhile, the Nationwide Building Society said house prices have risen  3.5 per cent in 2013, and climbed 1.4 per cent in the three months to August – the fastest increase in three years.

But figures from Lloyds TSB, released today, suggest the housing bubble is forcing young families to stay in first-time homes, years after acquiring them. The lender’s Home Movers’ Review showed the average age of a mover had risen from 37 in 2002 to 40 today, with most of the increase since 2007.

It said that while affordability had improved slightly for so-called “second steppers” – those looking to trade up from their first property – many of those who bought before the market crashed were still stuck in their homes.

Nitesh Patel, a housing economist at Lloyds TSB, said: “There are many potential second-steppers still in their first home, which they bought in the run-up to, and at the peak in house prices in 2007.

“Many may still be unable to move due to having very low, or negative, equity in their homes.”

The report said that many younger families had relied on having built up equity to be able to trade up.

The greater the difference between this “equity position” and the typical cost of a second home, the more difficult it is for potential buyers to get a mortgage to cover the cost of a move.

In June 2013 this difference was 4.4 times average annual earnings. London was the least affordable with a ratio of 5.7, with the East Midlands and West Midlands, both at 3.1, on the opposite end of the scale.

Discover more property articles at Homes and Property
Property search
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

Recruitment Genius: Business Development Manager / Sales - OTE £45,000

£35000 - £45000 per annum: Recruitment Genius: This company is a solutions / s...

Recruitment Genius: Sales Executive - OTE £45,000

£18000 - £45000 per annum: Recruitment Genius: A Sales Executive is required t...

Recruitment Genius: Test Development Engineer

£35000 - £40000 per annum: Recruitment Genius: Are you inspired to bring new a...

Recruitment Genius: Trainee Motor Engineer

£14000 - £18000 per annum: Recruitment Genius: This is an exciting opportunity...

Day In a Page

Sepp Blatter resignation: The beginning of Fifa's long road to reform?

Does Blatter's departure mean Fifa will automatically clean up its act?

Don't bet on it, says Tom Peck
Charles Kennedy: The baby of the House who grew into a Lib Dem giant

The baby of the House who grew into a Lib Dem giant

Charles Kennedy was consistently a man of the centre-left, dedicated to social justice, but was also a champion of liberty and an opponent of the nanny-state, says Baroness Williams
Syria civil war: The harrowing testament of a five-year-old victim of this endless conflict

The harrowing testament of a five-year-old victim of Syria's endless civil war

Sahar Qanbar lost her mother and brother as civilians and government soldiers fought side by side after being surrounded by brutal Islamist fighters. Robert Fisk visited her
The future of songwriting: How streaming is changing everything we know about making music

The future of songwriting

How streaming is changing everything we know about making music
William Shemin and Henry Johnson: Jewish and black soldiers receive World War I Medal of Honor amid claims of discrimination

Recognition at last

Jewish and black soldiers who fought in WWI finally receive medals after claims of discrimination
Beating obesity: The new pacemaker which helps over-eaters

Beating obesity

The new pacemaker which helps over-eaters
9 best women's festival waterproofs

Ready for rain: 9 best women's festival waterproofs

These are the macs to keep your denim dry and your hair frizz-free(ish)
Cycling World Hour Record: Nervous Sir Bradley Wiggins ready for pain as he prepares to go distance

Wiggins worried

Nervous Sir Bradley ready for pain as he prepares to attempt cycling's World Hour Record
On your feet! Spending at least two hours a day standing reduces the risk of heart attacks, cancer and diabetes, according to new research

On your feet!

Spending half the day standing 'reduces risk of heart attacks and cancer'
Liverpool close in on Milner signing

Liverpool close in on Milner signing

Reds baulk at Christian Benteke £32.5m release clause
With scores of surgeries closing, what hope is there for the David Cameron's promise of 5,000 more GPs and a 24/7 NHS?

The big NHS question

Why are there so few new GPs when so many want to study medicine?
Big knickers are back: Thongs ain't what they used to be

Thongs ain't what they used to be

Big knickers are back
Thurston Moore interview

Thurston Moore interview

On living in London, Sonic Youth and musical memoirs
In full bloom

In full bloom

Floral print womenswear
From leading man to Elephant Man, Bradley Cooper is terrific

From leading man to Elephant Man

Bradley Cooper is terrific