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The Downsizers are back!

The property market is never as it seems. At times there appears to be little warning as to how the market will react to the different players entering onto the scene. The latest player to flex its muscles with a marked return to the property market is the “downsizer”.

Many people are looking to trade down to a smaller property whilst releasing some of the equity from the sale. Recent research carried out by Prudential found that one in five homeowners over 55 plan to downsize within the next 5 years.

Whilst the value of smaller properties is rising, so too is the value of the larger homes that downsizers are planning to move from – making it a good time sell. In fact, some downsizers are selling their large family homes at a good price and then moving into temporary accommodation until they find their smaller dream home.

A recent study carried out by CACI shows that there is a tendency for affluent downsizers to live out their dreams by moving to the seaside or to the country. In the North West alone, downsizers are drawn to areas such as Cumbria and the Sefton coast. And in fact, the Fylde coast is the UK’s top location for downsizers with its draw of the coast and top quality golf courses.

Downsizing is not just for those who want to achieve their dream retirement home. It seems that more people are now choosing to downsize in order to release capital. This capital can then be passed on to children or grandchildren to give them a step onto the property ladder. Some commentators think that this recycling of equity is a good thing to keep the property market healthy and is something that we will be seeing even more of over the next few years.

The property market has gone through some dramatic changes over the first six months of 2014, with demand and prices increasing. Some believe that this may not be sustainable and that the market has already peaked. The truth is – we really don’t know. However, if you are looking to make that move to your dream retirement home as well as obtaining as much equity as possible from the sale, then now does seem to be a good time to make that move.