New data has surfaced, revealing a significant trend among UK homeowners over 55: a mere 14% plan on downsizing their homes. This statistic sheds light on a growing issue known as the ‘later-living logjam’, which is significantly impacting the UK’s housing market. The reluctance of older homeowners to move to smaller properties is causing a shortage in housing supply, directly affecting families looking to move into larger homes.
A survey encompassing 2,000 adults over 55 revealed various retirement plans:
- Staying Put: 50% intend to remain in their current homes.
- Downsizing: Only 14% are considering moving to a smaller home.
- Equity Release: 7% plan to stay in their current home and release equity.
- Rightsizing: 6% wish to move to a similarly sized home in a different location.
- Other Options: A smaller percentage look at living with family (2%) or moving to retirement communities (1%).
Steve Bangs from Pegasus, a later-living provider, stresses that this dilemma is twofold. It not only highlights the dire need for more diverse housing options but also underlines broader concerns about the health of the housing market. Families seeking to upsize are directly impacted, creating a ripple effect that slows transactions and hinders the prospects of first-time buyers.
Barriers to Downsizing
The survey identified the primary barriers preventing older homeowners from downsizing:
- Moving Hassles: 37% find the process too cumbersome.
- Cost Concerns: 35% are deterred by expenses like stamp duty.
- Suitable Housing Shortage: 26% struggle to find housing that meets their needs.
Tomer Aboody from MT Finance echoed these concerns, emphasising that high moving costs, particularly stamp duty, are major deterrents. He advocates for stamp duty reform to motivate downsizing, which would free up family homes and benefit both the downsizers and those moving up the property ladder.
A Shift in Attitude Among the Younger Segment
Interestingly, attitudes towards downsizing are more favorable among the younger segment of this group. A staggering 88% of those aged between 55 and 65 are more inclined to downsize, compared to just 8% of those between 66 and 75.
The Need for Support and Improved Planning
To alleviate this housing market logjam, Pegasus is advocating for more support for later-living developers and a reformation of planning laws. The current rigid planning system in England is seen as a significant hindrance to delivering suitable homes for older people. The lack of quality mid-sized and smaller homes, combined with limited awareness of options before dedicated care facilities, limits the market’s potential.
Government Statistics and Expert Insights
Government statistics reinforce these findings, showing that only 3.4% of people who moved last year were over 65, compared to 42% under 34. North London estate agent Jeremy Leaf notes that downsizing is generally considered more in the sixties and seventies. He emphasises the importance of planning ahead, especially as existing properties may not be suitable for later life. The lack of suitable housing is a critical issue, and better accessibility to retirement housing in planning could significantly improve the situation.