Suffolk Building Society has found that 15% of UK homeowners—equating to around 6.3 million adults—are considering or planning to downsize during the current five-year parliamentary session.
The mutual identified regional differences in attitudes to downsizing, with 10% of homeowners in the North contemplating such a move, compared with 14% in the South. In London, the figure rises to 25%, which the Society attributes to higher property prices and increased living costs.
Charlotte Grimshaw, head of intermediaries at Suffolk Building Society, said: “Not every downsizer needs a mortgage, but an increasing number do, due to the rising cost of living and current property prices. For some, it’s a repayment vehicle for an existing interest only mortgage that’s come to the end of its term. Therefore, it’s an important conversation for brokers to be having with their clients.”
The Society suggested that motivations for downsizing include releasing equity to support younger family members, increasing disposable income, or reducing the burden of property maintenance. It noted that UK homes cost an average of 8.5 times average earnings, putting pressure on affordability and prompting some homeowners to consider smaller, more manageable options.
Grimshaw added: “Encouraging homeowners to think about downsizing earlier rather than later means they’re well prepared to move at a time that suits them – or enjoy the cash they may free up from it. Being aware of all options of homeownership, including downsizing, means that people can make informed decisions in a timely manner and consider just what the right option for them looks like.”
She said that wider adoption of downsizing could help address some of the pressures facing the housing market. “Downsizing could also help to free up some of the UK’s housing stock and create momentum in the market for buyers, with larger houses becoming available for growing families. Over time, this may make it easier for more people to get onto the property ladder.”
Grimshaw concluded: “In setting out targets for new home construction, the Government clearly acknowledges the UK’s housing crisis. Certainly, more homes are needed to meet demand. But we’d also welcome some shorter-term policies, such as encouraging downsizing, to get the housing market moving across existing housing stock, while the building sector gears up to meet the challenge.”
