Second steppers still need ‘Bank of Mum and Dad’

Second steppers still need ‘Bank of Mum and Dad’

First time movers typically need to find an extra £125,694 to fund the move to their preferred next home of a detached property, according to Lloyds Bank.

Almost one in five (17 per cent) planning to move out of their first home will require financial assistance from family or friends to help bridge this gap, asking for more than £22,000, the lender reported.

Half of these second steppers told Lloyds Bank they feel that they wouldn’t be able to make the next move on the property ladder without this help.

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Lloyds poll of 505 second steppers between 16 and 30 April 2015 found almost three in four (71 per cent) intend to raise the deposit required for their next property purchase from equity in their current home, and 57 per cent will raid their savings.

Some 14 per cent said they were considering returning to family members to help them out – typically asking for £22,480.

This is up from £21,080 in 2014 and £21,273 in 2013.

Almost half (48 per cent) had also required help with the deposit on their first property.

The average loan size first-time buyers received from family and friends the first time around reached almost £24,000, only slightly more than they are hoping to borrow again from parents or grandparents to take their next step on the housing ladder.

Of those considering asking for financial support four in 10 admit that parents have had to make sacrifices to help them get on and move up the ladder, although this has significantly fallen from 70 per cent in 2013.

Andrew Mason, Lloyds Bank mortgages director, said: “Parental support has been playing an important role in helping young people get on the property ladder for decades but this is being stretched further.

“For many, parental support will be reaching its limit, as prices increase, so it is encouraging to see so many second steppers also standing on their own two feet, planning ahead and taking action to top up their equity levels.”

The research also revealed that almost two thirds (62 per cent) have either continued to save or started to save since they moved into their first property.