It is estimated that there are as many as 3.4 million pensioners who want to move out of their too large and expensive family homes that have become more onerous for them to maintain.
The government, however, may be able to throw them a lifeline by recently announcing plans to pay incentivise retirees to downsize into a smaller property; freeing up cash and cutting
The government has announced plans to pay incentives to older people to persuade them to downsize into a smaller property. It could be a lifeline for the 3.4 million pensioners who want to move out of rambling and expensive family homes, allowing them to free up cash and cut the cost of maintaining their home.
There are plenty of older people who are ready to downsize. There are 1.1 million with one spare bedroom and 2.3 million with two or more spare bedrooms. Saga research shows that seven in ten over 50s would like to ‘right size’ in retirement to smaller homes or age-related developments. They are put off, however, by the cost of moving and the lack of suitable property. This would also free up millions of family homes that would go some way to solve the current housing crises.
There have been no leaks to suggest what the government may include in the document, but commentators point out that there are several options. These includes schemes that are already run by some councils – providing help with moving costs, and financial advice for those who want to move. Alternatively, there could be a stamp duty exemption on downsizing into properties worth up to £250,000, which is something that Saga has previously argued for.
The initiative has been applauded by Saga’s director of communications, Paul Green. He commented: “If the Prime Minister can bring in measures to enable people to ‘rightsize’ in retirement this would be a true inter-generational solution to the housing crisis and would deliver on Mrs May’s promise of helping young and old alike.”
It’s a major step in the right direction, but this is only part of the solution, because the right kinds of homes need to be built too. Green highlights: “Britain needs a homes to be adapted or built to help older people live well in later life. Only 1% of Briton live in retirement developments, compared with 17% in the US and 13% in Australia.”
Older people don’t just want properties that are easy to maintain, energy-efficient and accessible, they also want storage space, room for their hobbies, a spare room, a garden, and plenty of light. And developers aren’t keen on building this sort of home, because they can make far more money by packing in high-density housing.
It doesn’t help that so many government initiatives have been focusing attention on the first time buyer market. Initiatives like ‘help to buy’ mean developers have a vested interest in building for first time buyers.
We will have to wait and see whether the government can put together an attractive enough incentive package to convince developers it’s worth building properties for older people. Perhaps this needs to include incentives for the developers themselves.
Otherwise it doesn’t matter how much help the government gives older people in downsizing: if there’s nowhere for them to go, they’ll still have to rattle around in an unsuitable and expensive family home.