Identifying the downsizer hotspots
In areas with high concentrations of potential downsizers, moving from a four-bedroom to a two-bedroom home can free significant equity.
19 February 2013, Words by Neal Hudson
Although the greatest gains from downsizing are to be made on the whole in London and the South East, the concentration of older people tends to be lower in these areas as they move away in search of a more leisurely lifestyle.
Traditionally, the UK’s retirees have been attracted to the South West and parts of Wales, and more generally to coastal areas including East Anglia and the North East. However, not all of these ‘pensioner honeypots’ have housing markets equally favourable to downsizing in financial terms.
We have looked at the amount of equity that can be released by moving from a four-bedroom to a two-bedroom home in the locations with the highest concentrations of residents aged 55 and 65 plus, and found that on average, it’s around £190,000 (just below the national average).
Regional market variations mean that in a third of the pensioner honeypot locations, more than £200,000 of equity typically becomes available through such a downsizing move, making them particularly attractive to older people looking to release housing wealth.
Indeed, on average, across these prime downsizing locations, it’s possible to make the less drastic move from a four- to a three-bedroom property (thereby retaining more accommodation) while still releasing over £150,000.
Top of the tables is the Mole Valley in Surrey, where more than £330,000 on average is freed up by downsizing from four to two bedrooms; Chichester, the Cotswolds, Christchurch and Castle Morpeth are also all in the £300,000 plus bracket.
More broadly, locations in the South West account for more than a third of the top 30 downsizer hotspots. At the other end of the scale are areas such as Thanet in Kent, Great Yarmouth in Norfolk and South Holland in Lincolnshire, which, although they boast a high concentration of retirees, have much lower-value local housing markets.
In these areas, it’s possible to release an average of £100,000 by moving from a four- to a two-bedroom home – but those only downsizing from four to three bedrooms won’t free so much equity.
Residential Property Focus Q1 2013