Gloomy homeowners should be more optimistic
Homeowners think it will take them much longer to move on to property number two than it does in reality.
In fact, prospective second-time buyers think they will be forced to wait 14 years before moving on from their first home, according to a survey by the Post Office.
The survey found that while the average age of those currently living in their first home bought it at the age of 28, they don't expect to move on to their second property until the age of 42.
However, in reality, the average age at which people surveyed became second-timers was just 34 - so that's a six-year wait rather than the anticipated 14.
And "trading up in the current market is better than it was pre-credit crunch", Kate Faulkner, managing director of independent property advice site Propertychecklists.co.uk, told Moneywise.
"For example, someone selling their £150,000 home for 10% less than they bought it for - a plight many homeowners across the UK have found themselves dealing with - would mean a selling price of £135,000.
"If they then trade up to a home that was originally £300,000 home but they save 10% on it, they'd pay £270,000 and so benefit from saving £15,000 on the overall transaction compared to the original asking prices," she explained.
However, she acknowledges the problems faced by those wanting to trade up if they bought their home in 2005/6 outside London. "Because of price falls that have been experienced around the country since then, many people won't have the equity to move forward. Exactly the same happened in 1990s, many people went into negative equity and 90,000 homes were repossessed each year."
But things have improved for people in this situation today. "Now we have help for those affected to stay in their property and we have the Help To Buy scheme so there is lots of support this time around.
"People can also let their property and rent somewhere else if they need a bigger home - which would probably quite cost effective, too, as larger homes often cost more to buy but don't cost that much more to rent.
"The reality is there are many more options in today's market than there were before the credit crunch."
The circumstances in which a property is worth less than the outstanding mortgage debt secured on it. Although it traps householders in their properties, the Council of Mortgage Lenders (CML) says there is no causal link between negative equity and mortgage repayment problems. At the depth of the last housing market recession in 1993, the CML estimated 1.5 million UK households had negative equity but most homeowners sat tight, continued to pay their mortgages and eventually recovered their equity position.