Last time buyers in the UK account for more than a quarter of the total number of households aged over 55 and their housing wealth is set to pass £1 trillion this year.
They now own £938 billion of housing stock and this will reach the £1 trillion mark this year, according to new research by Legal & General, the FTSE 100 financial services group, and CEBR, the economics consultancy.
According to the research there are now 3.1 million Last Time Buyer households in the UK, with the number of home owners who have considered downsizing rising from 32% to 39% in the past three years
It says that these figures demonstrate the level of demand for better later living options for over 55s at a time when there a chronic undersupply of age specific properties, with only 7,000 homes delivered to this sector last year making it the most under supplied area of the housing market.
The research also shows that of the last time buyers who had considered downsizing in the last five years but didn’t, some 49% said it was because there were no suitable properties available, with a further 29% stating that the properties that were suitable were too expensive.
‘This report highlights the crucial role last time buyers could play in unlocking the wider UK housing market, further demonstrating the need for Government to recognise this sector through key policy changes,’ said Phil Bayliss, head of later living at Legal & General.
‘If rightsizers were able to move to a property more aligned to their desired lifestyle and needs, vast swathes of homes would be freed up for growing families and second steppers. This, when matched by the huge health benefits proven to come from age appropriate housing, such as a 50% reduction in GP visits and 40% reduction in NHS spend, means that increasing the number of properties available to these buyers is the most efficient way to help solve the UK’s housing crisis and spiralling NHS costs linked to our ageing population,’ he explained.
The report reveals that optimal age to downsize is between 65 and 69, down from 70 in 2015. It says that this is a much more realistic age for rightsizing and shows a greater awareness of what’s involved and the benefits of making it an earlier proactive step.
However, a lack of suitable properties is hindering the rightsizing dream. The share of last time buyers who have not been able to downsize due to a lack of suitable properties has nearly doubled from 25% in 2015 to 49% today.
It also shows that 45% of last time buyers have lived in their home for 30 years or more, and 29% still live in the first property they ever bought while 17% have lived in their property for under 10 years.
Some 45% of last time buyer households live in a detached house, 72% no one in full time work, with most of these being retired, and the average weekly income is £632.
It also found that 13% of last time buyers said they would want to free up money for retirement from downsizing. The top use of cash released from downsizing is for supplementing a pension.
‘A large section of our housing stock, worth nearly £1 trillion, is under occupied and owned by people over the age of 55. It is vital that the over 55s are able to make and act on the choices that are right for them,’ Bayliss concluded.
