Elderly homeowners holding onto vacant homes while aspiring young families face dwindling options for spacious housing properties in the real estate sector
In the latest housing market update, it's clear that the market has started the year stronger than in 2024 or 2023. According to experts, buyer demand is 13% higher than a year ago[1]. However, for many over-50s, the dream of upsizing their homes remains a challenge due to financial barriers and high property premiums, particularly in desirable coastal and countryside locations.
Research by Regency Living reveals that coastal and rural home prices command premiums of up to 30% above the UK average in popular counties such as West Sussex, Hampshire, Essex, Kent, Dorset, and East Sussex[2]. This premium can make upsizing financially challenging for this age group, who prioritize lifestyle factors like living in scenic countryside or coastal locations[1].
Despite the financial struggles, more than half of individuals trying to upsize are finding it difficult due to a shortage of suitable homes[1]. Some are turning to alternatives like park homes, which offer a more affordable route to enjoy quality locations without compromising financial freedom, comfort, or community[1]. However, these options may not fully satisfy the upsizing home requirements of some buyers.
The cautious mentality that had been observed ahead of the summer's general election and the Autumn Budget began to unwind during the final couple of months of 2024. Sales of homes priced at £5m or more in London increased by 25% in the last three months of 2024 compared to the previous three months, with 130 such homes sold[1]. This increase is reflected in the average price paid for these homes, which reached £11m in the last three months of 2024, the highest average value since 2019[1].
On the rental front, the balance between supply and demand for rental properties outside London has improved, with 10% more homes for sale than at the same time in 2024, according to Zoopla[1]. Average rents outside London dropped for the first time since before the pandemic, falling by 0.2% to £1,341 per month in the last three months of 2024[1]. The pace of growth in rents outside London has also slowed[1]. In contrast, average rents in London continued to increase, reaching a record of £2,695 per month in the last three months of 2024, a 0.1% increase on the previous quarter[1].
In conclusion, the struggle to upsize among over-50s is largely driven by the tension between their lifestyle preferences for higher-cost desirable locations and the financial barriers created by high house price premiums in those markets[1][2]. As the housing market continues to evolve, it will be interesting to see how this trend unfolds in the coming months.
Sources: [1] Savills, Rightmove, Regency Living [2] Zoopla
- Given the high premiums for coastal and rural homes, many over-50s find it challenging to upsize despite their preference for lifestyle factors like scenic locations.
- Amidst the improving balance between supply and demand for rental properties, the struggle for over-50s to upsize continues due to financial barriers in desirable housing markets.
