Writer Julia Thum wants to swap her six-bed Edwardian home for something smaller and ‘more modern’ - John Lawrence
Writer Julia Thum and her husband Nicolas have taken the plunge and put their home of almost 20 years on the market.
Their large six-bedroom Edwardian house backs on to the River Thames near Bray, Berkshire, and holds many happy memories of bringing up their four children.
“Living on the river has been idyllic and this has been such a busy and happy house. But now our three youngest are all at university so we feel ready for an exciting new chapter,” says Julia, 61, who is selling up for £5.5m through Hamptons estate agency.
The couple are planning to move somewhere smaller and “super modern” that has fast transport links into London on the Elizabeth Line.
“We’d like to have enough space for the family to come home in the holidays, and hopefully put aside some cash for old age and to help our children out,” Julia says.
Julia’s Edwardian home that backs on to the River Thames is idyllic but she wants somewhere with better links to London - Hamptons
While many people in her position want the same things, few are actually making the move. Downsizing has fallen to its lowest level in a decade.
Over the past year, the number of people aged over 60 who sold their homes to move somewhere smaller reached a 10-year low, according to exclusive new research by Savills estate agency. However, experts say Labour’s policies on private schools and inheritance tax could force more to downsize.
Lucian Cook, of Savills, says: “The over-60s account for 44pc of all UK homeowners, but they remain relatively reluctant to downsize. Not only do downsizers typically feel an emotional attachment to their home, but they also face additional barriers of a lack of suitable stock to move to, the stress and complexity of moving and the financial burden of stamp duty.”
The weak housing market has also been a factor, with property sales overall in England and Wales down around a fifth in 2023, according to the Land Registry. In part, downsizers have struggled to sell because younger people moving up the ladder have faced higher mortgage rates.
“There has also been a reluctance among those who don’t urgently need to move to sell when the market is weaker because they want to maximise the equity they can extract from their home,” Cook says.
The sums don’t always add up
Over the past five years, downsizers have sold a total of £275bn-worth of property, according to Savills, releasing an average of £147,000 per downsizer before stamp duty and moving costs.
However, the majority of people aged 65 and over in the UK live in an average-priced home costing around £300,000, points out Neal Hudson, of the housing market analyst BuiltPlace. “For them, there’s no real financial incentive to downsize,” he says.
Savills’ research shows that downsizers are most active in the £1m-plus price bracket, which accounts for 34pc of sales, while only 13pc are active in the £250,000-£500,000 band.
“Downsizing is typically more prevalent in higher price brackets,” Cook says. “Consequently, it is more common for homeowners in the South East to downsize, where the value of properties is such that meaningful equity can be released from a sale.”
However, even in affluent areas, making the downsizing maths add up can be tricky if the main objective is to release capital.
James Law, of Stacks Property Search, says many people he comes across in Dorset, where he works, are selling a large four- or five-bedroom house in a rural location and are looking for a three- or four-bedroom house in a village or small town.
“Towns favoured by downsizers, such as Bridport, Beaminster, Poundbury and Sherborne, are highly sought-after by second homers, those trading up to a larger home and those relocating from cities,” Law says.
“Prices are correspondingly high, so swapping a remote family house for a semi-detached village house can leave little in the way of equity, especially once fees have been taken into consideration.”
Stamp duty is a major disincentive to move – especially for someone who last bought a property many years ago when the tax burden was much lower. And, unlike first-time buyers, downsizers haven’t benefited from targeted stamp-duty holidays.
Guy Meacock, of buying agency Prime Purchase, says: “People generally are staying in their homes a lot longer than they want to because stamp duty is so prohibitive. When stamp duty was 1pc [from 1984 to 1997], the market was much more fluid.”
Finding a buyer isn’t easy
The pandemic property boom of 2021-22 saw the number of downsizers peak as lockdowns spurred on younger buyers to purchase larger homes. Since then, however, soaring mortgage rates have meant upsizing has become significantly less affordable.
“Ultimately, your ability to downsize is going to be incredibly dependent on whether you can find a buyer,” Hudson says.
The high cost of building works and materials is also putting many buyers off refurbishment projects, which is a problem for downsizers, says Jo Eccles, of the buying agency Eccord.
“Many properties that haven’t changed hands in a decade or two need a lot of work, but with mortgage rates still high, and other financial pressures – such as VAT on school fees – the families who would normally buy these properties are finding it too much of a stretch with refurbishment costs on top,” she explains.
Crucially, if buyers do take on a doer-upper, they want to be compensated with a discount on the selling price, Eccles adds.
This means many people downsizing from higher-value properties are choosing to sell them privately, says Jennie Hancock, of the buying agency Property Acquisitions.
“Vendors are reluctant to expose their properties to the open market because they’re worried about the digital footprint of their home, in case they don’t sell and want to try again in the spring,” she says.
“Selling off-market means they can test the water on price and gauge the level of interest while they’re still figuring out their next steps.”
Lack of homes to move to
A key barrier to downsizing is a lack of choice in suitable homes, given that developers typically cater for the first-time buyer and family market.
Edward Hartshorne, of Blenkin & Co estate agency in York, says: “Homeowners want to downsize to easy-to-manage, energy-efficient and updated houses in either a town or city and there simply aren’t many available in Yorkshire.
“We have many substantial properties on our books where the owner is rattling around consumed by the need to move, but paralysed by indecision and the lack of appropriate housing stock.”
Meanwhile, age-restricted accommodation doesn’t appeal to many.
Richard Rogerson, of the advisory firm RFR Property, says: “Very few of our older clients would consider these homes. They want to be surrounded by youth and sophistication and not reminded of their age and mortality. If and when care becomes a material factor, most people would rather receive it in the comfort of their own homes for as long as possible.”
‘Retirement properties don’t appeal’
When it came to moving from the Grade II-listed house he renovated in a village near Bath, retired former property business owner Paul Short, 81, had no intention of heading to a retirement property.
“They don’t appeal to me at all,” he says. “I would rather be mixing in the community. Being stimulated and challenged are important to keep your brain working.”
Paul Short has found the ideal Grade II-listed flat in the centre of Bath - Jay Williams
Short, who is widowed, has sold his three-bedroom house for £630,000 and is buying a Grade II-listed, fully renovated one-bedroom apartment on the ground floor of a Georgian terrace in the heart of Bath for £395,000 through Winkworth estate agency.
“I have lots of friends in Bath and am looking forward to living in the city, close to the shops and all the facilities I need,” Short says. “From the large sash windows of my new apartment, I will be able to see Bathwick Hill, where I was born and grew up. I feel like I’m coming home.”
It’s not all about finances
One of the major hurdles for downsizers is saying goodbye to what has often been a cherished home for decades.
Claire Whisker, of the property advisory platform First in the Door, says: “Moving after such a long time – and after the housing market has changed so much – can feel overwhelming, particularly when transitioning to a smaller space. They will likely need to sell some belongings, which can lead to additional feelings of anxiety and sadness as they let go of memories.”
Yet, for those who embrace the change, it can be an exciting new chapter and many downsizers seize the opportunity for a lifestyle shift.
Savills’ analysis of Experian Movers data found that the most prevalent destinations for over-60s migrating within Britain are largely rural or waterfront. These include Ceredigion, Anglesey and Pembrokeshire in Wales; Babergh, Suffolk; Aberdeenshire; West Devon; and Eastbourne, West Sussex.
Marion and David Rayment’s downsizing move didn’t release any equity, but has brought lifestyle benefits - visualbank.co.uk
Quality of life was more important than finances for Marion Rayment, 58, who works in waste management, and her husband David, 69, who is retired. The couple recently sold their four-bedroom house in Hawkinge, Kent, for £600,000 and bought a fifth-floor, two-bedroom flat just three miles away in the Shoreline development in Folkestone, for £650,000.
“I’m much nearer to work and I cycle there each morning – it’s uphill now, rather than downhill, but it keeps me fit,” says Marion.
“Although we have had to get used to having less living space and a much smaller kitchen, we love the vibe of Folkestone and its great restaurants. It’s also so special to be looking over the beach and coastline. The sunsets are just amazing.”
The Rayments love ‘the vibe’ of Folkestone, and the sunsets ‘are amazing’ - visualbank.co.uk
Could we see a shift?
Estate agents say more large homes have come on to the market recently as homeowners struggle with high energy bills and the cost of living crisis.
Increasing numbers of downsizers also still have a mortgage, and moving is a way to reduce their monthly outgoings or become mortgage-free – Hamptons says that the proportion of downsizer moves paid for in cash has fallen from 64pc in 2016 to 55pc so far this year.
While many people downsize to free up cash to help adult children on the property ladder – Hartshorne at Blenkin & Co says about half the vendors he comes across don’t need to sell but want to downsize for this reason – the addition of VAT on school fees from January could prompt more of these moves.
“We’re hearing of more people thinking of downsizing to help with grandchildren’s school fees and I think that will motivate a lot of people who have been sitting on the fence,” says Hancock.
