Trade-up gap at £68,000 for home buyers moving from flats to three-bed houses

Home buyers taking their second step on the property ladder from their first flat into a house face paying nearly £68,000, analysis has found.

Outside London, the average trade-up gap to move from a two-bedroom flat to a three-bedroom house is £67,761, Rightmove said.

The typical gap increases to £183,093 for those trying to make the jump from a three-bedroom home to a four-bedroom house, the research found.

The analysis was based on the average asking prices of nearly three million properties.

Rightmove said that over the past five years, price growth for three-bedroom houses has outstripped that of two-bedroom flats, making the jump to trade up harder.

  • From a two-bedroom flat to a three-bedroom house, £67,761

  • From a three-bedroom house to a four-bedroom house, £183,093

In the East of England, the two- to three-bedroom trade-up gap is now over £100,000 for the first time, while the biggest trade-up gap in this sector was found to be in the South East, at £121,295.

Looking within London, but excluding the “prime” market of the most expensive properties, the trade-up gap from a two-bedroom flat to a three-bedroom house was put at £79,112.

Those looking to make the jump from a three-bedroom house to a four-bed in London face forking out £338,820 on average.

Across Britain, Rightmove found huge variations in the trade-up gap.

For example, in Swansea, a three-bedroom home costs around £11,000 more than a two-bedroom flat on average.

Swansea
Swansea

But in Esher in Surrey, the typical difference is £300,000.

Many estate agents have recently been reporting that buyers have been looking to move to bigger properties with more space, and perhaps an extra bedroom that can be used to work from home.

Rightmove’s director of property data Tim Bannister, said: “People who bought a smaller home five years ago and are now hoping to trade up will find it’s harder to afford the next rung of the ladder because of the different pace of the sectors.

“Those who really need the space and are struggling to trade up could widen their search area to find alternative places where they can get more for their money, or they may need to compromise on the type of home and opt for a terraced rather than detached.

“The cash jump is even bigger from three- to four-beds, likely due to four-bed homes often having additional bathrooms, bigger gardens, garages or outbuildings, as well as an extra bedroom, but traditionally home owners stay in their second home longer, and so more people may have built up enough equity to make the jump to their forever home.”

Here are the typical trade-up gaps faced by home buyers across Britain, according to Rightmove, with the price of trading up from a two-bedroom flat to a three-bedroom house followed by the price of trading up from a three-bedroom house to a four-bedroom house:

– East Midlands, £70,733, £150,749

– East of England, £102,992, £179,345

– North East, £43,481, £136,667

– North West, £46,506, £155,633

– Scotland, £39,290, £132,043

– South East, £121,295, £221,242

– South West, £79,646, £174,244

– Wales, £43,772, £148,184

– West Midlands, £66,574, £166,656

– Yorkshire and the Humber, £39,259, £145,309

– London (excluding prime properties), £79,112, £338,820