One in four retired homeowners hope to raise £62,000 by moving into a smaller home
Nearly three quarters (73 per cent) of the UK’s 10.4 million pensioners own their own home, although more than a quarter (26 per cent) expects to sell their property to raise money or simply to make their life easier, according to new research from Prudential.
Releasing substantial amounts
Four in every five (81 per cent) retired homeowners who expect to sell are
planning to buy another property. This is equivalent to around one million homes being bought and sold by pensioners, many of whom will release substantial amounts of cash by downsizing.
The majority (73 per cent) of retirees who plan to sell up and buy another property want to move into a smaller and less expensive home. On average, they expect downsizing to raise as much as £62,000.
Boosting income in retirement
Nearly a quarter (23 per cent) plan to use the money raised to boost their income in retirement, 13 per cent will pay off debts and eight per cent say they’ll use the money to help with everyday living costs.
Prudential’s research also shows that over one in five (22 per cent) retired homeowners still have an outstanding mortgage, with average monthly payments of £254.
A simpler life
The convenience of running a smaller home was the most commonly stated motivation for those who plan to downsize – 48 per cent say they want a simpler life. Separately, 22 per cent claim raising money is the main driver for their sale, while 11 per cent want to reduce household bills.
Staying on the property ladder remains the overwhelming preference among retired homeowners. Just six per cent of pensioners planning to sell their home intend to move into specialist retirement accommodation, while only four per cent expect to move into a rental property.
All figures in this release are taken from the State of Retirement Report, produced by Opinium’s Desk Research unit and the survey team. The survey research was carried out with a custom sample of 1,541 British adults aged over 50 between 13–20 May 2013 by Opinium Research on behalf of LV=. Of this sample, 835 adults (54 per cent) are currently classed as ‘retired’.