Head of Senior Living
8 May 2018
Last Time Buyers looking to downsize hold the keys to easing housing crisis
The UK housing market is at a crunch point; it has become split across generational lines and is now a major symptom of, and contributor to, intergenerational inequality. The Institute for Fiscal Studies has illustrated that young middle-class professionals today are half as likely to get on the housing ladder as they were 20 years ago, so now is the time to free-up properties that will be beneficial to all parties.
Increasing the overall supply of housing is clearly one lever that needs to be pulled, yet the Government’s housing policy does not reflect the nuanced nature of housing demand. There needs to be a greater focus on the provision of housing across all tenures, and specifically the significant undersupply of housing designed and built for over 55s. But equally important is ensuring that the current stock of housing is fully optimised. Last Time Buyers – older homeowners who live in properties that are now too large for them, and would like to downsize - are a key part of this.
There are now 3.1 million households who are aged over 55 and looking to downsize in the future. The total stock of housing wealth owned by Last Time Buyers will exceed £1 trillion for the first time this year. The UK’s ageing population means this issue is forecast to get worse, not better.
If we can free up this housing stock, it would make a huge contribution to easing the housing crisis, freeing up family-appropriate properties close to schools, balancing intergenerational inequality and boosting the UK economy. The Last Time Buyers have a lot to gain too – instead of staying put in properties that no longer suit their lifestyle, they can experience health, financial and social benefits in safer, more appropriate accommodation with reduced running costs.
Much of the debate around the housing crisis focuses exclusively on First Time Buyers and the challenges of getting on the property ladder. Given the numbers involved, it is amazing how little attention has been paid to Last Time Buyers, even though they are open to downsizing, and to doing so at a younger age.
One thing that hasn’t changed is the type of property that Last Time Buyers dream of – for most it’s a two bedroom home near to family and friends, with more than one in 10 keen to move to dedicated retirement housing or a retirement village.
Indeed, while much of the downsizing debate tends to focus on costs (and these are an issue) we believe that the lack of good quality later living housing is the fundamental barrier to Last Time Buyers making the decision to move. Increasing the UK’s stock of dedicated later living housing supply is a smart way to unlock the Last Time Buyer market, help solve the housing crisis, and play a significant role in reducing the escalating NHS health and care costs for the elderly.
We need to do more to help our Last Time Buyers find a property that suits their needs and lifestyle aspirations. Traditional retirement villages may not have focused on these factors – but that is no longer the case. Inspired Villages Group, is an example of a business that is leading the way in supporting a forward-thinking lifestyle for older people, providing them with safe and secure, fit for purpose homes that form a vibrant extension of the wider community and allow them to live happier, healthier and more active lives. With evidence showing that Later living communities can make a real contribution to local NHS services by helping to reduce visits to GPs, as a sector we have a responsibility to ensure we are taking action to increase provision of this type of housing.
We want to ensure that this key demographic have a choice. An increase in the supply of later living housing is not only a smart way to help solve the housing crisis, but would also help to mitigate the escalating healthcare costs for the elderly.
If we can free up this housing stock, it would make a huge contribution to easing the housing crisis, freeing up family-appropriate properties close to schools, balancing intergenerational inequality and boosting the UK economy.