New research from Legal & General and economics consultancy CEBR has revealed that last time buyers now own £938 billion of UK housing stock, with this figure set to reach the £1 trillion mark this year.
The research found that there are currently 3.1 million last time buyer households in the UK, with the last three years seeing the number of homeowners who have considered downsizing going up from 32% to 39%. What’s more, last time buyer households account for more than a quarter (26%) of all UK households over the age of 55.
According to the findings, the UK suffers from a chronic shortage of age-specific properties. In fact, only 7,000 homes were delivered to this sector last year, ensuring it was the most under-supplied part of the housing market.
Of the last time buyers who had thought about downsizing in the last five years but didn’t, nearly half (49%) said it was because there were no suitable properties on offer, while a further 29% stated that the properties that were suitable were too costly.
“Last time buyers account for more than a quarter of the total number of households aged over 55,” Phil Bayliss, head of later living at Legal & General, said. “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.”
He added: “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, 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.”
The study revealed that the optimal age to downsize is now between 65-69 – down from 70 in 2015 – while the inability to downsize is now affecting nearly double the number of people it was three years go (49% versus 25%).
Meanwhile, some 45% of last time buyers have lived in their home for 30 years or more, while 29% still live in the first ever property they purchased. By contrast, only 17% of last time buyers have lived in their home for less than 10 years.
The research also looked at the type of homes last time buyers live in, with 45% residing in a detached property.
Some 72% of last time buyer households have no one in full time work (with most retired), while the average weekly income for a last time buyer household is £632. Additionally, 13% of last time buyer households said they want to free up money for retirement from downsizing. The top use of cash released from downsizing is for supplementing a pension.
“A large section of our housing stock – worth nearly £1 trillion – is under-occupied and owned by people over the age of 55,” Bayliss concluded. “It is vital that the over 55s are able to make and act on the choices that are right for them.”