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Buyers stepping up housing ladder pay record £68,000

Christina Hoghton
Written By:
Christina Hoghton
Posted:
Updated:
02/10/2020

It’s no secret that getting on the housing ladder is tough, but trading up to your next home is increasingly challenging too

Home movers are having to pay almost £68,000 on average to move from a two-bedroom flat to a three-bedroom house outside London, analysis has found.

The ‘trade-up gap’ is £4,000 more than this time last year, according to asking price data from property listings site Rightmove.

The gap increases to £183,000 for those trying to make the jump from a three-bed house to a four-bed house, up from £180,000 last year.

Rising prices

Prices of two-bed flats have increased by 15 per cent over the past five years, while three bed houses have jumped by 20 per cent, leading to a record gap for households looking for more space.

Over the past five years, the price growth of three-bedroom houses has outstripped the price growth of two-bedroom flats every year.

Regionally, the smallest jump from a two-bed to a three-bed is in Swansea where the difference is £11,000 on average, and the biggest jump is in Esher, where there is a £300,000 difference.

Rightmove’s director of property data Tim Bannister, said: “People who bought a smaller home five years ago and are now hoping to trade up will find it’s harder to afford the next rung of the ladder because of the different pace of the sectors.

“Those who really need the space and are struggling to trade up could widen their search area to find alternative places where they can get more for their money, or they may need to compromise on the type of home and opt for a terraced rather than detached.

“The cash jump is even bigger from three to four beds, likely due to four bed homes often having additional bathrooms, bigger gardens, garages or outbuildings, as well as an extra bedroom, but traditionally homeowners stay in their second home longer and so more people may have built up enough equity to make the jump to their forever home.”