While many people consider downsizing in later life, it might not be the best solution. Read on to find out why… and discover an alternative way to free up your finances.

According to a recent survey, some three in five people aged 65 have considered moving to a smaller property, yet – for a variety of reasons – many don’t see it through.

The survey of Family Building Society members, conducted to support a Radix Housing Commission Report, found the most common reason cited for deciding against downsizing was the financial barrier imposed by stamp duty, although a similar number of respondents stated that the loss of their local community – including long-established ties to friends and family – was their top concern.

Various practicalities also featured heavily, including the potential need to move further away from convenient amenities, such as shops, GP surgeries and transport links, as well as a lack of suitable properties available, particularly bungalows.  

The alternative to downsizing

If you don’t want to downsize right now – or if circumstances mean it’s currently not an option – there’s another way you can free up your hard-earned capital.

Equity release enables you to unlock some of the money (equity) within the value of your home, meaning you can gain some financial freedom while staying put in your family home.

While opting for an equity release scheme is a decision you should never take lightly, schemes have become more flexible in recent years. Lifetime mortgages (a form of equity release) now offer a ‘no negative equity’ guarantee, meaning what you owe will never exceed your home's value, and you or your family can even pay the monthly interest like a normal mortgage if you want to.

Are you eligible for equity release?

If you’d like to release funds from your home – perhaps for retirement plans, debt repayment or to help your children with a home deposit of their own – but are reluctant to downsize, you will be eligible for equity release if:

• You are over 55
• You own your own home (which is worth a minimum of £70,000)
• You don’t have any other debts against the property

If you’re interested in releasing funds for retirement, speaking to an experienced later life mortgage specialist is a great first step, as they have a wealth of knowledge and can advise you on which option might best suit your circumstances. If you would like to talk to us about either downsizing or equity release, we’re here to help.

For more detailed information, you can also download our free guide to equity release.