New research from MGM advantage has found an increase in the number of the UK’s retired population downsizing their homes. 1.99 million retired people have already downsized their homes and a further 12% are looking to downsize over the next 5 years.
These figures suggest that £136.5 billion of housing equity will be unlocked from property downsizing within the next 5 years.
Many people think that downsizing their home is the best option in order to fund their retirement, believing that the cash payout they can gain from selling their home will stand them in good stead for the future. On average the capital a UK resident can gain from selling their home is £102,8512. This is an 18% increase on the cash release from just a year ago at £84,776.
Andrew Tully from MGM advantage gave the retired population some advice, “Banking on your own home to provide an income in retirement does not come without risk. The old adage of all your eggs in one basket still holds true. Careful planning and consideration should be given before making the move, and with returns available from the cash released still very low, it is likely the capital will also be consumed over time.”
The large lump-sum gained from downsizing your home is attractive however it is important to make this money as beneficial to you as possible, we believe, a wise option would be to invest the capital gained in order to reap longer and more profitable benefits. As investment rates are so low in banks at the moment it is important to explore other options available, an average buy-to-let property investment can offer a potential 7.7% return on investment.
A buy-to-let investment provides a steady rental income and when working with an agency, such as Mistoria, the property is managed on the owners behalf. There are no concerns over finding tenants or upkeep on the property as it is all taken care of for you by the agency.
Mistoria are specialists in property investments providing a range of different options to suit each investors needs, if you would like more information on which type of property investment is best suited to you please contact us by calling 0800 500 3015 or email us at email@example.com.