Downsizers: Release £110k and reinvest in booming UK property markets

 

Empty nesters across the country who are living in oversized, detached properties could release more than £100,000 by selling up and moving to a bungalow – and maybe reap the rewards from property investment.

Almost half of over-55s are continuing to live in large, family homes after their children have flown the nest and are not considering downsizing, according to research by Lloyds, with many citing the main reason as being their strong bond with the area, as well as being financially comfortable enough to stay put.

However, the study also looked at price differences across various property types, and discovered that while the average detached home is worth £360,000, bungalows are priced at around £250,000 – as of March 2018 – meaning that some households could net themselves £110,000 by moving.

Factors to consider

In the south-east of the country, the price difference between a detached home and a bungalow is a huge £275,000, compared to London where the windfall would amount to just £54,780 – and homeowners in the north-west, East Midlands and Scotland could stand to make £80,000-£90,000 by downsizing.

One issue with downsizing, though, is a lack of available, suitable properties for older people. Bungalows make up just 10% of the housing stock in the UK, according to the English Housing Survey, and they tend not to be evenly spread with some areas having huge concentrations and others having none.

What could you do with all the extra cash?

However, one option for downsizers, which has become more popular in recent years, is to move into a new-build. They are not only much easier to come by due to rapid housing stock expansion in the UK, but also offer huge potential savings in terms of energy bills and minimal maintenance costs. Many are also now being developed with a number of in-built amenities including communal areas, meaning they can be a great option for over-55s who want to be part of a mixed community.
[crb_image link=”https://www.buyassociation.co.uk/advice/property-investment-starter-course/” image=”https://cdn2.hubspot.net/hubfs/1717782/Asset_Store/WebCTA/cta.jpg” align=”left”]
As cash savings still generate very limited interest, many will be reluctant to release cash from their homes without investing it elsewhere – and property is still generally considered the top place for your money to be in terms of capital gains and future returns. Therefore, downsizers could also look at reinvesting their cash into an investment property, providing added security for the future.

There are, of course, a range of factors to consider when looking at investing in property, including stamp duty, estate agent fees and conveyancing fees, but many will still find this an attractive option – particularly in emerging, up-and-coming parts of the country where house prices are predicted to soar over the next five years, such as Manchester and Birmingham.

CityGreens, Solihull, Birmingham

City-style apartments directly on Birmingham's largest park

  • Limited pre-launch prices.
  • ZERO ground rent
  • Excellent tenant demand

£182,000 - £419,000

Highgrove Mews

High Net Yield Freehold Houses

  • Commutable to London (27 mins to central Paddington station)
  • Rental demand extremely strong with large industry presence in Reading
  • Freehold with 4% net yield

£284,955 - £457,000

St Petersgate – Stockport Manchester

New Launch - Stockport Manchester, apartments from £160,000

  • Discounted launch prices from £160,000
  • Excellent transport links with 3 trains per hour to London Euston and only 9 mins journey to Manchester Piccadilly
  • Experienced development team

Assured Rent Housing Association Leases

Assured Rent Housing Association Leases

  • Assured rent & no rental voids
  • Tenant damage cover & newly refurbished inline with requirements of a corporate sitting tenant
  • Free property and lettings management

From £62,000

Emerging Birmingham Commuter Town With Properties From Just £104,000

The emerging Birmingham commuter town where properties are selling in an average of just 24 days

  • A collection of 62 two bedroom apartments and 28 one bedroom apartments.
  • DE14 is one of the fastest selling postcodes in the West Midlands.
  • 23 minute train journey into Birmingham New Street Station.

Properties from £104,000

Mill, Stockport

The Northwest's emerging property hotspot

  • Discounted off-plan 2-bed prices from £162,000
  • Completion date - Q4 2021
  • Rental yields - 6% plus

Discounted off-plan 2-bed prices from £162,000

ba-

Talk to us

Speak to our UK property experts today: 

+44 (0) 333 123 0320

Open from 9am-6pm GMT

+852 9865 4446

Open from 9am-6pm HKT

Stamp Duty Calculator

.

Unlock members only investment opportunities and full development details. Join now – it’s free, quick and easy.

Login

Not a member? Sign up for free

Downsizers: Release £110k and reinvest in booming UK property markets

Downsizers: Release £110k and reinvest in booming UK property markets

Example

By submitting your details via this online form you agree to be contacted via email/phone/SMS by Direct Marketplace Ltd t/a BuyAssociation in relation to property investment and property developments . We do not share your personal details with third parties.  To view our full Privacy Policy click here.