The survey, conducted by You Gov for the mortgage lender, reported the average difference between a first and second mortgage could add at least £135 extra per month to mortgage repayments, with a larger mortgage being the biggest hurdle for 49 per cent of homeowners. A further 7 per cent said they could not afford the costs of moving, including stamp duty and legal fees.
Roy New, a London-based sole broker, was not surprised by the findings. He said: “It’s an obvious problem with house prices rising upwards and salaries not increasing. It’s a situation where second-time movers across the board won’t be able to move. I hope this won’t create a bottleneck in the market, because then no one would ever move. But lenders are going to have to move to mortgages based on affordability, not income multiples, as this would help stop the problem. Mortgage lenders afflicted with ‘tunnel vision’ need to open their eyes.”
Paula Ickinger, product executive, mortgages and loans at Abbey, said: “Almost half of the UK population own their home with a mortgage and a further 23 per cent own their home outright. If these homeowners do decide to stay put and extend their property this could create a bottleneck in the housing market for both new and existing customers.
“First-time buyers are getting older while they are also squeezing in careers and families before turning 40. They may be trying to take bigger steps up the ladder in a shorter period of time, but high house prices are preventing them from doing so.”
