Published on September 20th, 2015 | by Pete0
Parents downsizing for the sake of their children
Whilst younger people are still finding it extremely difficult to become first-time buyers (FTBs), recent observations from the likes of the Council of Mortgage Lenders have highlighted that older people are living in houses which are too big for them. Irony aside, these are national problems that are contributing to a “sluggish “ property market.
On a regional level, however, some parents have already caught on to the fact that they can give their children a leg-up the property ladder – not by raiding their savings, but by downsizing – killing two birds with one stone.
A key reason why older homeowners sit on their five-bedroom assets is that they can’t find a suitable two-bedroom property. But while property diversity and population density cause issues in some regions of the UK, in other areas it’s feasibly easier to downsize.
Downsizing is becoming a trend with a mission
Dave Dyer is the Director of a family-run lettings and estate agent in Chorley, Lancashire. Redrose Property Sales and Lettings Ltd have seen a general upswing in the number of people aged over 50 who are actively seeking suitable smaller properties to downsize to, in order to help their children become homeowners.
“There are two reasons people are downsizing, the first being the obvious one in that the property they are living in is now too big, as their children have flown the nest,” says Dave.
“The other is that we’re seeing people downsizing in order to release equity for their children to buy their first home.”
The latest figures from the Land Registry (July to August) show the UK’s average house price is now £183,861. In London this is £488,782, while the North West remains one of the lowest regions on cost at an average of £144,064.
A house in this price bracket isn’t a starter home either, but one that’s suitable for a growing family. Dave explains: “A three-bedroom house with a garden, in a Chorley village location, can come in at under £120,000.”
According to Which? the average deposit for FTBs is around 17%. This means lads and lasses in Lancashire need to save approximately £19,000.
Dave adds: “These grown-up children might be renting and finding it difficult to save a deposit, or living at home, which can put pressure on family relationships.
“It’s an ideal compromise for parents to downsize into a smaller property that’s cheaper to run and easier to manage, while the children get the security of their first home.
“There’s a good selection of properties in the North West, with plenty of diversity and something for everyone. So generations of families are able to live within easy reach of one another without having to actually live with each other,” says Dave.
Feature provided on behalf of Redrose PM by every1 (08447 550 350).