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In the middle of economic difficulties in part as a result of the Covid-19 pandemic, there is a rapidly growing trend that sees many London residents looking to downsize.When you downsize, you move into a home that is smaller than your current one (either physically smaller or financially cheaper). Invariably, this is done as a result of the old home no longer needing to cater to a large family; a smaller house is less of a responsibility in terms of maintenance, utilities, general upkeep etc. However, one of the most common factors involved in downsizing is the economic upside. By moving to a smaller house, you are able to lower your cost of living, giving you the financial boost that you may need. The most significant contributing factor for Londoners downsizing right now is the economic benefit. In a survey conducted by Barratt Homes, it was revealed that 68% of over 50s living in London are considering or have already downsized. Of those asked, 76% were empty-nesters; people whose children, now adults, have moved away. The majority of respondents were noted to be living in homes with three or more bedrooms. While this leans toward houses being too big for what is needed, the financial element is also a major factor. As many with adult children are approaching retirement age, being able to downsize presents them with the prime opportunity to finance this. Although this can certainly help along the way, Steven Webb, former pensions minister, has described the idea of relying on the funds from your home for your retirement as a “delusion”. Webb believes that the average downsize would only provide an income of roughly £5,700 a year; with the maximum state pension included, that is only £13,800. Rather than living entirely off of the funds from a home, you can instead use the sale to subsidise your income throughout your pension. This is not, however, a case of people moving out of London. Granted, some are leaving the capital, but there are many who are simply moving to a different part. For some, downsizing to the country means purchasing a smaller but still very homely and comfortable property for significantly less value, far from London prices. But for many, leaving the city is not an option for them. 21% of the respondents for Barratt Homes suggested that while they wanted to downsize, they were not looking to sacrifice their London lifestyle, be it for the transport links, the amenities or for work commitments. And this might lead to issues in the wake of the Stamp Duty Holiday now being over. As we have mentioned in previous articles, the current belief among industry experts is that the property market is set to slow down significantly in the aftermath of the Stamp Duty Holiday deadline, with the fear that house demand will continue to be in a lull for some time. So for those aiming to sell their London home in order to reap the financial benefits, you may encounter some difficulty either in finding a buyer or getting a reasonable offer on your property. As London property prices have been the slowest to grow since the mini boom last year, selling a property in London might be harder than ever. Spring, however, has a wealth of experience in buying homes in London. We buy any home in any location and with our dedicated team of property buying experts, we can ensure that you can make the move you want to. We also provide a sell house fast service where we buy the property from you and, in as little as seven days, have the money in your account meaning you can continue on to the next chapter of your life. To find out how Spring can help you with your downsizing journey, contact us today and speak to a member of our team.
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