While first-time buyers face a daunting task getting on the property ladder it is those taking their fourth and final step that face the biggest jump when it comes to the cost of their onward purchase, research from estate agent comparison site GetAgent.co.uk has revealed.
GetAgent analysed the current cost of property per square foot, what this equates to for the average home at each rung of the property purchasing ladder and how wide the gap is between each of these rungs when it comes to climbing it.
Realising the aspiration of homeownership has grown increasingly difficult for the nation’s first-time buyers, with the average first-time buyer house price across England up 13.6% in the last year alone.
The research by GetAgent shows that with the average cost of bricks and mortar currently sitting at £306 per square foot across England and the average first home coming in at 808 square feet, first-time buyers are facing a total cost of £247,147 when it comes to securing their first home.
It doesn’t get much easier for second steppers looking to upgrade, whether it be with a partner or due to starting a family. The average home when climbing the second rung of the property ladder sits at an estimated 958 square feet, meaning the price gap between first and second rung of the property ladder is an additional 19% or £45,881.
Those with a growing family and in need of more space have the shortest gap to traverse between the second and third rung, with a third rung home of 1,066 square feet coming in just 11% higher than a second rung home. Although this does equate to an additional £33,035.
However, the largest gap on the property ladder is found when taking the fourth and final step upwards for those searching for what can be essentially considered their forever home with enough space to accommodate a maturing family.
At an average of 1,668 square feet, the cost increase versus a third rung property comes in at a huge 56%, equating to a step of £184,137 more where the total value of a home is concerned.
The good news? Those in the final stages of the property purchasing lifecycle can cash in considerably when it comes to downsizing. With the average home for a downsizer coming in at 829 square feet, a step down from the dizzying heights of the top rung of the property ladder will cost them 50% less, leaving them with plenty in their back pocket to enjoy their later years. An average of £256,630 to be exact.
Colby Short, co-founder and CEO of GetAgent.co.uk, said: “There’s no doubt that the initial first step onto the property ladder is the toughest, with first-time buyers having to save a considerable sum from scratch to secure a mortgage deposit, not to mention the fact it’s a new and often daunting experience in itself.
“However, the uphill struggle doesn’t stop there and each rung of the ladder requires yet further financial thought for those looking to progress upwards.
“What stage of life you’re at will dictate the size of the gap between one rung and the next and generally speaking, the task of climbing from a starter to home to one suitable for a young or growing family is more manageable than making that fourth and final step upwards.
“Of course, the silver lining is that you will have accumulated some level of financial foundation within your existing property depending on how much of the mortgage has been repaid and this can help with the initial task of securing your onward purchase.
“But it takes careful thought and planning to ensure that you can continue to afford the high cost of homeownership as you take that next step and that you haven’t overstretched when it comes to the cost of repaying your mortgage.”
