A new property scheme may come into play, after MPs call for a ‘Help to Move’ scheme for those over the age of 60.
Retirement housing was tackled by an inquiry, which found that eight million elderly people occupying seven million homes would be interested in downsizing their living space.
One problem hindering the housing market is that a great deal of properties is held up by elderly people in homes that no longer fit their household size. As children move away, and mortgages get fully paid off, elderly couples can find themselves in possession of three or four bedroom houses, whereas a one bedroom would be more suited to them.
In a market where young families are struggling to move out and acquire homes, this hold up can have a far reaching impact.
The report investigating the issue said that the “Government could help kick-start an expansion of new housing for older downsizers by enabling them to access a ‘Help to Move’ package, along similar lines to Help to Buy, but also including tax incentives and comprehensive financial advice.”
Methods for aiding downsizing that have been suggested include an exemption from Stamp Duty Land Tax, deferred payments, shared ownership and lifetime leases.
Unfortunately, the problem of pensioners holding up family-sized property will only escalate as homeowners become less and less likely to pay off their mortgages by the time they retire. By not owning an asset as large as a home outright, people will be more financially restricted and thus less able to move.
These eight million elderly people who would move out are just as trapped by the system as those attempting to get their feet on the property ladder. This proposed scheme should act to free up a rung or two for young families to become successful first time buyers.