Aspirational home buyers looking to move upmarket in the South West are bearing the brunt of the stagnant housing market, a survey claims.
So-called "second-steppers" are unable to move up the ladder to a bigger home because they do not have sufficient equity in their current property, the report says.
The plight of the group in the region is highlighted by the amount they are paying to trade up – the highest outside London and the South East, according to Lloyds TSB.
The average second-stepper home in the South West costs £219,647, figures show.
On average, a purchase at this price requires a "deposit" – made up of equity in the current property and extra cash – of £73,648, equivalent to 34% of the purchase price.
The huge problem they now face, the bank says, is that their equity in their current home accounts for just 7% of the asking price of a typical second-stepper home, compared with 42% in 2005.
Nitesh Patel, housing economist at Lloyds TSB, said flat house prices in regions such as the South West, where prices remained static last month, had left many with low equity.
"The difficulties faced by aspiring second steppers are having a considerable knock-on impact for potential first-time buyers due to the resulting shortage of properties available on the market, with housing chains proving hard to establish," she added.
There are about 319,000 would-be second-steppers nationally, according to the latest Lloyds TSB Home Movers Review. The bank has created an "annual affordability measure" which sets average equity as a ratio of average earnings.
The South West is one of the worst affected, with a measure of 5.7 times the average gross annual full-time earnings for 2011, compared to 3.3 in 2002. Only the South East, at 6.3, and London, at 6.1, were worse.
Richard Copus, South West spokesman for the National Association of Estate Agents, said: "People are still selling first homes and moving into slightly larger ones as families grow and earnings increase. Even if they can, they will be holding less equity and borrowing more than they did in the past.
"But it is more difficult to move up to a second home as it is hard to get a mortgage or increase a current loan even for people with increased income."