There has been plenty of coverage in the press about the plight of the first-time buyer with incomes failing to keep pace with house prices, and lenders demanding ever-bigger deposits.
But what about the ‘second stepper’ – those who already own a home but can’t move to a bigger one because they don’t have enough equity? Those who bought at the peak of the housing market in 2007, often with a modest deposit, are now finding that the value of their home has fallen so any equity they did have has been eroded. This is making it impossible for them to move to a bigger home, which they may need to do because they are starting a family.
These ‘mortgage prisoners’ are now trapped and can only realise their home ownership dream if they improve their equity stake, perhaps using savings. Alternatively, they could become ‘accidental landlords’ and rent out their homes while they rent somewhere bigger, selling when the housing market picks up again.
Click on the link to see my appearance on BBC Breakfast this morning: http://www.bbc.co.uk/news/business-19378337