HOME owners are spending on average more than £100,000 to step up the property ladder, Royal Mail’s Home Movers study of its redirection customers has revealed
On average, people in the South West who moved up the property ladder paid £94,700 more than the value of their previous home.
More than 60 per cent of home buyers in the South West borrowed the money while 20 per cent saved to pay the additional cost of the new home.
There are significant regional differences. People in the North East paid on average £89,100 more for their new property compared with their previous home, while in London it was an additional £182,100
On average 20 per cent of home buyers used their own savings rather than borrowing to pay the additional cost of the home. Wales had the highest proportion of people who funded their move through savings – one in four (26 per cent)
This compared with just ten per cent in London. The South East had the lowest proportion of people outside of London who saved to pay the additional cost of the new home (17 per cent).
London had the highest proportion of people in the UK who borrowed to pay for the move (76 per cent) while Wales and North West England had the lowest (62 per cent).
Outside of London, the Midlands had the highest proportion of people in England who borrowed money for their move (74 per cent). The lowest proportion of those who borrowed was in the North West, 62 per cent of home buyers.
In Scotland, 65 per cent of home movers borrowed the money while 22 per cent saved to pay the additional cost of the new home.
People across all age ranges had borrowed money to pay for their move. The study found that 14 per cent of 65-74 year olds borrowed from a bank or building society to fund their new home.
Andrea Martin, Royal Mail’s Managing Director of Data Services, said: “Royal Mail’s Home Movers Study of our Redirection customers provides fascinating insights into the cost of moving up the property ladder and explores how people are funding their moves.
“While people in London are spending significantly more to move up the property ladder than other parts of the UK, people are relying on borrowing much more than savings to fund the move. Meanwhile, Wales has the highest proportion of people saving to fund the move, and the lower proportion of people borrowing the money.”
The study comes as Royal Mail encourages people across the UK to redirect their mail when moving home in order to protect themselves against identity fraud. Royal Mail’s Redirection service enables home movers to redirect their mail from their old address to their new home. In 2013 Action Fraud received 133,216 reports of fraud that involved illegal use of someone’s identity with a total value of £410 million.
Action Fraud, the UK’s national reporting centre for fraud and internet crime, advises individuals to redirect their mail for at least a year after moving home to help protect them from identity fraud. For further information on ways to protect against identity fraud, people should visit the identity fraud page of the Action Fraud website.