44% of owners 'want smaller home'

Oct 6 2012

Almost half of potential Scottish home movers want to downsize within the next three years while less than a quarter want a larger property, according to research.

Downsizing is now the main reason for people selling their homes, the latest study from Bank of Scotland found.

A fifth of those considering the move are looking to trade down earlier than expected, with the majority citing financial concerns as the main driver. Reducing bills, freeing up equity in the property and boosting retirement plans are among the reasons cited for downsizing in these tough economic times.

Laurence Mann, head of mortgages at the bank, said: "Downsizers are now playing a key role in the Scottish housing market and as the study shows, we are starting to see homeowners on different stages of the property ladder considering it as a sensible option as more and more families are looking at ways to save money."

Homeowners approaching retirement often consider downsizing to a more manageable home. But the report found that the reasons for downsizing have broadened in the current economic climate.

Almost half of potential home movers (44%) want to downsize within the next three years and only around a quarter (23%) want to move to a larger property.

While around two-thirds of would-be downsizers (68%) want a property better suited to their circumstances, one-third (34%) would like a smaller property to help reduce bills. One-third (32%) want to free up equity and another third (32%) want to downsize to support their retirement plans.

According to the research, two-thirds (68%) of potential downsizers are over 55, a quarter (25%) are aged between 46 and 55 and around 5% are aged between 36 and 45.

Around two-thirds (64%) of potential movers considering downsizing have lived in their property for over a decade, a quarter (25%) have lived in their home for between six and 10 years and around one in 10 (11%) have been there for five years or less.

The bank also noted that for those trading down early in Scotland, the windfall associated with downsizing from a detached property to a semi-detached property has risen by 67% over the past decade. A downsizer today would receive an average windfall of £102,308, compared with £61,055 in 2002, according to the bank.