Generation Downsizing: Young people are far more likely to move into a smaller home than the elderly as soaring property prices stop them moving up the housing ladder
- Young people are four times more likely to downsize their homes than elderly
- Survey found 12 per cent of 18 to 34-year-olds expect to move to smaller place
- In contrast just three per cent of over-55s anticipate downsizing this year
Young people are four times more likely to downsize than the elderly, according to a survey which lays bare Britain’s property divide.
It found that around 12 per cent of 18 to 34-year-olds expect to move into a smaller home this year, compared with just 3 per cent of over-55s.
The figures confirm how hard it is for young people to move up the housing ladder. They also point to similar problems in the rental sector.
Many under-35s looking to downsize are thought to be tenants in parts of Britain where rents are going up quickly. They are forced to move to smaller properties each year because their wages are not increasing at the same pace.
People aged 18 to 34 are more likely to move into a smaller home this year than the elderly. A survey showed around 12 per cent of this age group expect to move into a smaller home this year, compared to just three per cent of over-55s
Other young downsizers may be first-time buyers who cannot afford a mortgage on a home as big as the one they rent.
Leeds is the downsizing capital of Britain according to the survey by savings firm Hargreaves Lansdown, with 16 per cent of people saying they planned to switch to a smaller property within a year. Next on the list is Edinburgh on 12 per cent, followed by Brighton with 10 per cent.
At the other end of the spectrum, in Southampton only 1 per cent of residents are planning to downsize.
Sarah Coles, of Hargreaves Lansdown, said: ‘Generation Rent is being squeezed out of the property market and crammed into smaller and smaller homes.
‘Tenants may be forced to keep downsizing in order to keep a lid on costs. When they eventually buy, they may have to downsize again in some areas to get on to the property ladder.’
Meanwhile many older people have paid off their mortgages, reducing pressure on them to move to a smaller house.
Young families forced into small homes by rising rents and prices
Pensioners may also be staying put because of the boom in equity release. This allows them to borrow money against the value of their house which is not repaid until after they die – meaning it is possible to release a chunk of a property’s value without having to sell up.
The survey found that although few over-55s intend to downsize soon, 22 per cent expect to do so at some point. There have been calls for the Treasury to axe stamp duty for retirees, encouraging them to move and free up homes for families.