Legal & General is calling on the Government to remove Stamp Duty from later living properties to allow older people to move and free up housing.
Research by the insurer and The Centre for Economics and Business Research said last time buyers, those aged 55 and over, now own £938bn of UK housing stock and will reach the £1 trillion mark this year.
Using ONS data, the analysis calculates that there are 3.1m last time buyer households in the UK and found while 39% have considered downsizing, the costs and lack of suitable properties is stopping them.
Almost half, 49% said they could not downsize due to a lack of suitable homes, while 10% cited Stamp Duty costs.
The report found 32% would be more likely to move if they benefited from a reduction in or exemption from stamp duty and Legal & General adds that this would free up homes for the market.
The insurer also suggests the creation of a new planning use class so local authorities would have set targets to build later-living homes.
Phil Bayliss, head of later living at Legal & General, said: “Last time buyers account for more than a quarter of the total number of households aged over 55.
“This report highlights the crucial role they could play in unlocking the wider UK housing market, further demonstrating the need for Government to recognise this sector through key policy changes.
“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.”
It comes as the All-Party Parliamentary Group on Housing and Care for Older called for the bungalow to make a comeback in rural areas to help cope with the ageing population.
The group warns there was too much focus on two-storey homes and that more bungalows or retirement schemes were needed.
I totally agree with this……we need to consider more ‘retirement villages’ consisting of dual purpose bungalows and onsite community facilities. We need a national housing strategy in this country….that actually works!
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Anyone who has ever worked in the investment market will know that downsizing is usually a pipe dream.
Conversation generally goes like this. ” Do you have enough money in your retirement”? ” No, but I plan to downsize to a nice two bedroom flat and bank the sale proceeds”
OK, But you just told me that your wifes great passion is the garden. You also told me that you have four grandkids and you have them over every weekend to stay. “How does your two bed flat accommodate your wifes love of the garden and having the grandkids stay”?
“You’re not downsizing to a two bed flat are you”? “Em, No doesn’t look like it”. OK plan B.
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Very true!
Or your get the couple living in a modest 3 bedroom semi house looking to ‘Downsize’ to a bungalow.
They then realise the bungalow is a greater value than their house.
End up staying in the Semi for another 10 years, house falls into disrepair and they move to a bleak retirement apartment. Probably after one of them have past away, they then spend upwards of 500 per month maintenance fees.
Ahhhh the retirement dream!
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I agree with AgentV, not everyone that wants to downsize wants to live in a flat and especially not a ‘retirement apartment’ that costs an arm and a leg in maintenance fees! Anecdotally, I’ve seen, in the area I live in anyway, every time a small bungalow comes onto the market (usually at a ridiculous price) it’s snapped up and extended in every direction and into a 2 storey property. Two bedroom bungalows are like hens teeth, and if you want it to be detached too, well forget it.
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