UK house prices 2015: squeeze hits owners trying to upgrade
Lloyds data show number of transactions in decline as prices soar and supply remains low
It is not just first-time buyers that are being squeezed out of the housing market, according to new data.
Homeowners seeking a larger property are facing an increase in costs that is as prohibitive as getting onto the ladder in the first place.
A report by Experian said moving from a one-bedroom to a two-bedroom flat or from a three to four-bedroom house can be as expensive as buying a first property in almost all of 276 UK towns studied across the UK, The Times reports.
Homeowners need to find an extra £70,000 deposit to buy homes which cost on average 42 per cent more than smaller properties in the same area, with the largest difference in areas within commuting distance of city hubs where existing local residents are being priced out.
The biggest disparity is in Scotland’s 'central belt', especially around Glasgow, where the "cost of a larger property is at least double that of a one or two-bedroom home in five locations, including East Kilbride, Clydebank and Paisley".
Other hotspots include Burnley in Lancashire and Abergavenny in south Wales, where larger homes are around double the price, and a number of southeast towns such as Farnham in Surrey, High Wycombe in Buckinghamshire and Tunbridge Wells in Kent, where prices are around 90 per cent more.
A shortage of supply is again cited by the report's authors – and is also given as a potential reason for an overall fall in property sales across the UK in the first half of this year, revealed in a separate report by Lloyds Bank. The Daily Telegraph says there were 155,000 purchases in the first half of this year, down from 171,700 in 2014 and less than half the market peak in the first six months of 2007.
But the steep increase in house prices in recent years is also said to be weighing on demand, which could act to reduce inflation in the months and years to come.
In particular, Lloyds says more are being caught in the stamp duty net which starts for homes worth more than £125,000: the proportion of home movers paying stamp duty is 83 per cent, compared with 76 per cent in 2005.