Just over a third (36%) want to downsize in retirement, according to research that scotches the view that a “rabbit hutch” home is a pensioner’s dream property. The survey was carried out by Nationwide Building Society1 – the first major high street bank or building society to offer a full suite of mortgage products designed to help people access the value that may be locked up in their home in later life, to enable them to live comfortably in retirement. It shows that while just 36 per cent would downsize, one in five (20%) baulk at the thought of reducing their home’s footprint, saying their next home move will be to a same size or larger property. Just over two in five (43%) say they never plan to move again.
The survey, which polled more than 2,000 people aged 55 plus, found that space was the main reason for staying put (49%), with respondents saying they don’t want to downsize due to needing room to host family (22%), for a lifetime of possessions they have amassed (18%) and to enjoy their hobbies (10%).
But staying where they’ve put down roots is also important, with just over four in ten (43%) saying their home location was the reason for wanting to stay, while being close to family (18%) was another.
For those willing to downsize, more than half (56%) say this is because a smaller house would be easier for them to manage or easier for them to get around in old age. But seven in ten (73%) said they would stay in their current house if they could.
Although many want to stay in their home for the long term (54% see their current home as their forever home), 47 per cent either don’t know, or haven’t thought about, how they will cope with their home in old age. But rather than have a clear plan, more than a fifth (22%) say they will rely on family to help them out with maintaining the property.
Around a quarter (24%) would also consider using equity release to allow them to stay in their current homes with respondents saying they have, on average, £115,559 in equity.
Jason Hurwood, Nationwide’s Director of Home Propositions, said: “The perception that all older people want to downsize to much smaller properties is outdated and cliched. As the research shows, people aged 55 and above are putting off the traditional downsizing house move, with space being very much in demand for a range of reasons – from entertaining friends and family to allowing them to keep and store valuable keepsakes and belongings. However, remaining in a larger property may have financial implications in later life, from mortgages to maintenance.
“With many retirees being property rich and cash poor, planning for the additional costs that may be needed is essential. Nationwide offers a range of Later Life Lending options as we are seeing more demand from older people to realise money through their homes – from unlocking the value to fix long standing maintenance issues, from creating new space to updating tired rooms or from helping adapt the property for old age to taking their mortgage into retirement.”
Alongside Nationwide’s standard mortgage lending options, the Society offers three Later Life Lending options. These are a Retirement Capital and Interest product (RCI), a Retirement Interest Only (RIO) product and a Nationwide Lifetime Mortgage for older borrowers. Accessed with the help of specialist Nationwide Later Life mortgage consultants, the advice process allows for a simultaneous eligibility assessment on the suite of products2.
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Media Information:
Michelle Slade, michelle.slade@nationwide.co.uk, 01793 657500
Mike Pitcher, mike.pitcher@nationwide.co.uk, 01793 657225
