Property 

Housing shortage creates downsizing woes

Housing shortage creates downsizing woes

A shortage of small properties is making it harder for retirees to downsize, equity release adviser Responsible Life has claimed. 

According to the firm's research, the downsizing dilemma is so bad that there is double the number of four bedroom properties for every two-bedroom house in 16 per cent of places. 

Responsible Life surveyed the number of four-bed and two-bed houses for sale in 120 major UK towns and cities and found Cambridge and Rugby to be the worst affected areas, where there are three four-bed houses for every one two-bed. 

Overall, in two thirds of areas the number of four bedroom properties outweighs two-bed houses, the adviser stated. 

Places with the highest ratio of 4-bed to 2-bed houses:

Place

No. of 2-bed houses

No. of 4-bed houses

Ratio 4-bed to 2-bed

Cambridge

26

83

3.2

Rugby

35

106

3.0

Inverness

17

45

2.6

Cardiff

86

211

2.5

Stevenage

23

56

2.4

Huntingdon

19

46

2.4

Oxford

51

121

2.4

Hemel Hempstead

60

140

2.3

Salisbury

18

41

2.3

Solihull

49

111

2.3

Meanwhile, the North of England was home to the areas providing the most choice for downsizers, with St Helens, Hull and Sunderland topping the list of areas where two-bed houses outnumbered four-beds.

Steve Wilkie, managing director of Responsible Life, said: "Retirees consider downsizing to be one of the easiest ways to release some cash in retirement but many are confronted by a crippling lack of options.

"Across the country, there are significantly fewer smaller houses for sale and they are being fought over by three groups of people — downsizers, first-time buyers and those moving up the ladder.

"This lack of supply feeds into prices and unfortunately for many it’s just not worth downsizing once the cost of moving and Stamp Duty are taken into account."

David Hollingworth, associate director of communications at L&C Mortgages, said: "As we live and work for longer there’s likely to be more homeowners staying put in the family home until later in life.  

"There’s an argument that that’s at least in part caused by a lack of availability of the right type of property to suit retirees.  They may like the idea of downsizing, but aren’t at the point where a retirement complex suits their needs and preference. 

"As more homeowners stay in larger homes for longer there’s also a clear knock on for younger generations who would have expected better availability of family homes as they step up the ladder."

Research out last week found demand for equity release was rising in all UK regions

Lifetime mortgages are now estimated to account for about a third of all mortgages taken out by homeowners from their mid-50s onward compared to less than a fifth ten years ago.

In the five year period from July 2012 to June 2017, London and southern regions in particular showed strong growth in consumer demand, with London experiencing a growth of 138 per cent and the south east seeing 143 per cent growth. Sales in the east of England were up the most, by 158 per cent.