Two in five (44%) estate agents have seen a rise in enquiries from older customers looking to downsize in the past year, research from equity release referral service Key Partnerships has found.
However three in five (62%) said downsizers have unrealistic expectations about how much they will raise from moving to a cheaper home if they can find one.
Will Hale, director at Key Partnerships, said: “When downsizing works it can be an ideal solution for older homeowners but sellers need to be realistic about how much they are going to make and it appears many are struggling to find suitable homes.
“The shortage of homes for sale is pushing up prices for downsizers who may struggle to raise the sort of money they are expecting to help with retirement planning while also having to go through the upheaval of moving home,
““Equity release should be part of all conversations with older homeowners considering downsizing, when for many it simply doesn’t add up. Estate agents who can offer equity release as a potential alternative are able to benefit from an additional revenue stream by referring potential clients to a specialist.”
Over half (56%) of estate agents said there is a shortage of homes on the market suitable for downsizers and seven in 10 (68%) warned there are not enough homes for older buyers who are less mobile.
Estate agents are now suggesting lifetime mortgages as an alternative way of raising money, with just under half (44%) saying they regularly bring up equity release as an option.