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Is this ok or is it bad from SEO and design perspective and should be changed to different tags?
I prefer to use only one H1 page per page - because I feel that a page has only one main topic. If I feel a second H1 tag is needed, then I look at breaking the page into 2 pages.
I would not advise this, because navigation is universal on a site - it's not specific to the individual page's topic. I think using H2 in this way starts to blur the page's true relevance signals. So I'd suggest restricting H tags to the content area, and not using them in other areas of the page template.
Designers often think of an H tag as a mere rendering instruction for the browser, and are not aware of the semantic importance of the tag. It's easy enough to code a css class that looks just like the H2 - so that's what I suggest. In fact, look at H2, H3 etc in the content area and make sure that all those uses also have semantic importance. <h2>But Wait, There's More!</h2> doesn't really make sense, you know what I mean?