The generation who are sitting on a gold mine
Nicola Venning meets the homeowners unlocking the wealth in their spare rooms
Whoever said pots of gold were found at the end of the rainbow got it wrong. The wealth is in your home, or rather your spare room. The property group Savills has estimated that more than half of the 5.53 million homes owned by over 65s have at least two spare bedrooms and that this group is sitting on a total of £1.33 trillion in housing wealth. “There is enormous potential for the older generation of homeowners to unlock significant sums of equity tied up in their homes,” says Lucian Cook, head of residential research at Savills.
According to the study, 54 per cent of homes owned by the over 65s in the south-east of England, have two spare bedrooms and these are worth £428,837 per household. In the south-west, the figure is also 54 per cent with the two additional bedrooms being worth £303,207.
The West Midlands has one of the highest number of 65-year-old households with two bedrooms at 57 per cent. This equates to £222,869 of locked up equity per home.
London inevitably tops the table with £599,652 worth of spare room cash.
Such potential extra wealth can fund a very fun retirement or, in the case of the Phillips’, help them afford to move into Cheltenham town centre.
Tired of rattling around their large family home in the pretty village of Kemerton in Gloucestershire, empty-nesters John Phillip and his wife, Beth, both 73, are swapping their five-bedroom house (on the market for £1.1 million) and moving to a better suited, Regency-style, modern town house in central Cheltenham (with a £980,000 price tag).
“The new house has much less garden and a significantly smaller footprint. It will require less energy and be easier to maintain,” says Phillip. “We will find it easier to enjoy the things we like doing in Cheltenham, without having to do a 14-mile drive each way.”
The couple are part of a growing trend. Savills estimates that around 90,000 households downsize each year unlocking equity of around £14.5 billion.
“A lot of people, especially downsizers, are buying lock-up-andleave apartments in nice urban spots and city centres,” says Philip Harvey, partner with Property Vision Buying Agency, based in London and the Home Counties.
Chic Cheltenham ticks a lot of boxes for this group. Recent research from Knight Frank, claims that more than 40 per cent of its buyers in the regency town are over 50 years old, with the vast majority being downsizers.
“There is a lot going on with literary and jazz festivals, horse racing, as well as restaurants and parks. It makes for a very cosmopolitan lifestyle,” says Hayley Wilks at Knight Frank.
Ground floor period conversions are particularly in demand, she says, as well as homes with off-street parking, good security and lifts, if the apartment is on a top floor.
Architecturally attractive market towns and cities with homes close to vibrant centres, are also a good fit for this generation. Christchurch, Chichester and Eastbourne are all popular with the over 60s.
It’s possible that the sale of one five-bedroom house in the right village can fund the purchase of two properties. Suzi and Paul Lacey, 59 and 61 respectively, are selling their home near Tewksbury to buy a bolthole in West Sussex or St Andrews (they have family in both areas) and a primary residence in Italy. It has been their life-long dream to be somewhere warmer and on the coast so it’s off to Umbria for them.
Christine Yexley (64) wants the reverse. She aiming to downsize to Bath once she has sold her elegant four-bedroom waterfront home in Golant, Cornwall, which overlooks the Fowey estuary. Her village home, which comes with a natural pool and almost an acre of garden, is on the market with Knight Frank for £1.18 million.
Yexley wants to be in the historic city centre, “where I can walk into town and I don’t need a car,” she says, “and where I can be near my old friends.” Although she is leaving the country for the town, Yexley still values some kind of outside space. “I need to open the door and go into my own garden,” she says.
Giving up on a garden is a common mistake many downsizers make, says Wilks. “Transferring from having a garden to a flat with no garden can be too big a jump,” she says.
Successful downsizing requires some careful planning. As well as the home, the size of the furniture and number of belongings also
Italian job: Sue and Paul Lacey want to buy a bolt-hole in West Sussex or St Andrews while primarily living in Umbria, Italy, main; their kitchen, right
City living: John and Beth Phillips are selling their home in Kemerton for a house closer to the town of Cheltenham, above