"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"
- Steve Bangs - Pegasus
A new survey of over 2,000 adults over the age of 55 commissioned by Later-living provider, Pegasus, has revealed that attitudes toward downsizing are changing. According to the findings, only 14% of those aged over 55 are planning on downsizing with 50% planning to remain in their current family home. This figure rises to an astonishing 68% of those aged 71-75.
The survey, which explores the housing dilemmas that many older people face, also underlines the reason behind the reticence to downsize. The hassle of moving (37%) and the cost of stamp duty (35%) were the two biggest barriers to downsizing. A lack of suitable housing was the next biggest barrier for over a quarter of future downsizers (26%).
Steve Bangs, CEO of Pegasus says: “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.”
In ten years, the number of people in England aged 65 and over will have increased to 22% of the population or around 13 million people. Research shows that four million older people want to move home, in turn, placing huge pressure on the nation’s existing housing stock.
Pegasus’ data also shows that attitudes towards downsizing are shifting, with those aged 55-65 most inclined to downsize (88%) compared to just 8% of those aged 66-75. With future downsizers on the rise and a lack of suitable smaller housing to move to, Pegasus is asking for more support for later-living developers through fast-tracked local planning to help plug the gap.
A recent study found that more than a third of local authorities are still making no provision or plan whatsoever for new housing for older people in their local plans.
Steve adds: “England’s rigid planning system fails to provide a framework that enables and encourages the delivery of homes in the later living sector. This puts the UK decades behind countries like the US, with our nation’s perception of later living and the reality of age-specific housing completely mismatched.
“The lack of supply of quality mid-sized and smaller homes combined with the lack of awareness of a step that exists before moving into a dedicated care-led facility keeps the sectors potential capped for consumers.”
Alongside supply, Pegasus’ results highlighted the not-insignificant impact taxation is having on older movers.
Steve explains: “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% 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 in encouraging many to downsize and encourage fluidity across the market.”
The survey also highlights the need for a mix of tenure options to serve the nation's changing housing needs. Pegasus’ survey found that one in five over-55’s said they would consider renting in their retirement, rising to just over a quarter for those no-yet-retired (29%). This proportion rises again to 44% for those currently renting – the most likely group to say this.
Steve continues: “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 aging in place and dedicated care facilities, whilst a focus on benefits and opportunities would better support retirees weighing the downsizing decision.”
He concludes: “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.”
