Slight Increase in Second Stepping in Scotland
A recent review by Bank of Scotland Homeowners has revealed some pretty good news regarding the Scottish housing market.
The review showed that affordability for ‘second steppers’ in Scotland has improved in the past year as a result of higher equity levels.
According to an article in Property Reporter, “Housing affordability for Scotland’s second steppers – calculated as the average price of a typical second stepper home, 1 less their current equity position, 2 as a ratio of average earnings – stood at 3.9 times gross annual average earnings in June 2013.”
“This measure of affordability has risen significantly over the past decade – signifying a decline in affordability – from 2.6 in 2003. There has been a modest improvement since June 2012 when the ratio stood at 4.0.”
However, if you delve further into the figures it can be seen that all isn’t perfect in this market.
The review has still shown that equity levels for second steppers is still very low, by recent standards.
Additionally, the price of actually moving is estimated to be just over £7,000, on average, which still hampers Scotland’s second steppers.
When talking to Property Reporter, Nitesh Patel, housing economist at Bank of Scotland, commented: “Housing affordability for the typical second stepper in Scotland has marginally improved in the past year. Nonetheless, there are many potential second steppers who are still in their first home which they bought in the run-up to, and at, the peak in house prices in 2008. Many of these homeowners may still be unable to move due to having either very low, or negative, equity in their homes.
“The lack of equity for many homeowners in their existing home largely explains why the number of Scottish homemovers in the first six months of 2013 rose by only 2% compared with a year earlier; while the number of first-time buyers grew by 22 % over the period.”
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