According to research commissioned by Equifax, 46% of people believe there should be a government incentive to encourage older homeowners to downsize, to free up space for younger buyers. Unsurprisingly, the younger generation are most in favour of such an initiative.
It’s just one of many areas the Government is looking at to solve the problem of housing in our country. It remains especially difficult for new buyers to purchase their first property and many people are living in properties which are too small for them. There is a belief that by helping older people to move to somewhere smaller and more suitable for them, that some of the problems can be eased.
The Government has not yet proposed any concrete plans, however in its recent white paper “Fixing our broken housing market” it has outlined its ideas.
A study by Legal & General in 2015 highlighted the scale of the housing market owned by older people. They identified that 11.4 million homeowners were over the age of 55 years. Many of them had intentions to move, but many of them often left it too late. More than 50% thought they should wait until they were over 70 and 25% over 80.
Legal & General also considered research from Cebr, which indicated that 3.3 million homeowners over the age of 55 were looking to move. But for many reasons, only 7% did.
A typical older homeowner looking to downsize lives in a four-bedroomed property but ideally would like a two-bedroomed one. Under-occupied properties are quite common, with just over a third of properties falling into this bracket across England and Wales. It’s a higher percentage in rural locations (close to 50%) where you can find approximately two million under-occupied houses. The greatest number of properties though, at around eight million are to be found in urban locations.
If the Government gets it right, then helping the older generation to move into properties more suited for them could be beneficial for the housing market overall.
For help making the legal process of buying or selling your home easier, please call LPL on 0333 3055 189.
