Mum and dad help second steppers up ladder

Second Steppers are returning to the bank of mum and dad as the cost of stepping up the housing ladder continues to rise.

According to the latest research from Lloyds TSB, one in six (16%) second steppers are contemplating turning to the bank of mum and dad to plug the gap between the value of their first home and the cost of the house they would ideally move to.

The majority of second steppers will be hoping to use savings (59%) or equity in their current property (77%) to fund the move to their second property. However, almost one in five (18%) are also considering going back to their family – such as parents and grand-parents – to ask for financial support.

The average loan size first-time buyers received from family or friends reached almost £13,700 up from £13,000 last year. Yet, the amount requested by second steppers to help them move up the ladder has increased by almost £7,000 in the past 12 months to reach £19,216 (up from £12,746 in 2011).

Marc Page, mortgages director at Lloyds TSB said: "We already know that second steppers face a number of tough challenges and it is unsurprising that they are struggling to fund the gap needed to trade up to their preferred second home.

“Parents have long been helping to fund their children’s first home, but many are now having to provide further support as they move up the ladder. This indicates that these customers still need further support.

Peter Lawrence at Lawrence Rand added: “To achieve a sustainable housing market we need to see movement throughout the market. If second steppers get stuck on the first rung, movement at the bottom half of the ladder comes to a standstill.”