According to a poll of over 2,000 people conducted by Pegasus, 50 per cent intend to stay in their current home, whether it’s rented or owned. This rises to 68 per cent among those aged between 71 and 75.
Some seven per cent expect to release equity, while six per cent plan to relocate to a home of the same size in a different area. Just two per cent intend to live with family and one per cent will move to a retirement community.
Barriers to downsizing
The survey found that 37 per cent of respondents said the hassle of moving was putting them off downsizing, and 35 per cent cited the cost of stamp duty. These were the biggest barriers, according to those polled.
Steve Bangs, CEO of Pegasus, said: “Stamp duty is directly discouraging people from moving, especially in the over-55s, where house prices have rendered many equity-rich but cash-poor.
“The over-55s now account for 75 per cent of all housing equity in the UK, and many of these homes are under-occupied. A stamp duty incentive for last-time buyers will go some way towards encouraging many to downsize and encourage fluidity across the market.”
More than a quarter – 26 per cent – said the lack of suitable housing posed a challenge.
Bangs added: “The downsizing dilemma is significant for the industry for two reasons – not only does it underline the lack of supply and need to build more homes fit for all, but it also underscores a huge concern with the overall health of the housing market.
“If older homeowners remaining in larger family homes feel they can’t move, upsizing families will also find themselves at a loss. This will in turn have a ripple effect right across the board, slowing down transactions and hindering housing prospects for first-time buyers.”
Mix of tenure options needed
The survey also suggested there was a need for a mixture of tenure options, as a fifth of people over 55 said they would consider renting after retirement. This rose to 29 per cent when accounting for those who were yet to retire. Current renters were most likely to choose this option, as indicated by the 44 per cent of over-55s who said so.
Bangs said: “It sounds simple, but there is no one-size-fits-all approach to housing in this major life transition. This is why a strong tenure mix, including later-living communities, must take priority in the UK’s race to build enough homes.
“Ultimately, we need a more robust national conversation to raise awareness of the need for a range of later-living options between ageing in place and dedicated care facilities, whilst a focus on benefits and opportunities would better support retirees weighing the downsizing decision.”
He added: “The ideal is for retirees to make empowered choices aligned with their needs and aspirations.
“Through education and community collaboration, we can shift conversations to realise more fulfilling visions for later life.”
