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Home mover mortgages reach nine year high
The number of people that are moving home in 2016 has reached its highest level in the last nine years.New figures published as part of the latest Lloyds Bank home mover review have shown that the first six months of 2016 recorded a nine per cent annual upturn in home mover activity across the country.
Compared to the same period last year, the lender`s data showed there have been a number of changes that have influenced many people`s decision to take the next step on the property ladder.
Indeed, rising house prices have helped to make the process of sale and purchase a much more attractive option for many.
According to the research, almost 175,000 people have taken steps to move up the housing ladder in the first six months of 2016, with affordability for second steppers having considerably improved in the last 12 months.
It is a process that has been ongoing for the last five years, with the lender highlighting significant improvement in this area from 2011.
The measure of mortgage affordability, calculated as the ratio of average earnings to average property values, has improved gradually in recent years, coming down from 7.3 times in 2011 to 6.5 times at present.
This means households up and down the country are now in a stronger position to be able to afford a larger mortgage, with the temptation of moving up the property ladder therefore proving attractive to more and more people as the years have gone by.
However, the research did go on to highlight growth in the average deposit needed among home movers in recent years as well - rising from almost £207,000 five years ago, to just over £261,500 in June 2016. This marks a 38 per cent rise in the last five years.
Responding to these latest results, Lloyds Bank mortgage product director Andrew Mason said: `A favourable economic backdrop, record low mortgage rates and the stamp duty changes announced in December 2014 have supported the market.`
He went on to add that higher house prices have also boosted home mover equity levels, which in turn have helped to increase the funds available for the purchase of their next home for many.
`This improvement is likely to have provided uplift to housing demand amongst existing homeowners, even though wage growth has not kept pace during this period,` Mr Mason concluded.
Overall, the report paints a generally positive picture of the housing market at present, at least in terms of ongoing activity for those already with a foot on the UK property ladder. It remains to be seen if this is a stable situation.
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