Downsizing is a phenomenon that is accelerating in popularity. Home owners who have built up significant equity in their property are choosing to ‘cash in’ on their property in order to find big budget purchases such as exotic holidays, dream cars and second homes.
According to research by Prudential, downsizing your property could raise as much as £85,300 and Saga has estimated that as many as one-in-five soon-to-be retired people are considering moving to a smaller property. Whether you’re keen to invest the equity released from downsizing, or want to be frivolous and spend it on life’s luxuries, releasing equity by moving to a smaller property could offer a whole new lifestyle.
Another not insignificant motivation for downsizing is the desire to help children secure a foot on the property ladder by assisting with deposits and other costs associated with purchasing your first property. The idea of having a smaller property doesn’t only appeal to those approaching retirement in financial terms, the idea of having a smaller home to manage and maintain, and therefore having more free time is also a large draw. A more manageable house and garden can free up a huge amount of time to spend with family or pursue hobbies that have had to take a backseat during your working life.
Danny Luke, Business Manager at Quick Move Now, explains: “Increasing property values mean that many home owners have significant equity in their property. Instead of sitting on this nest egg and remaining in a large property, as home owners probably would have done a generation or two ago, they are choosing to cash-in and spend some of the equity on once in a lifetime experiences or extravagant purchases, or to help other family members with financial gifts. With an aging population, people are determined that retirement should be a time to go on adventures, have memorable experiences and experience the finer things in life.”