Things to consider when choosing a home in retirement
Tue 29 Aug 2023
When people reach retirement and are no longer tied to a job, their priorities tend to shift. They have more free time to indulge hobbies and interests and perhaps the opportunity to travel more – whether that’s visiting friends and family around the UK or holidaying further afield. And if children have moved out of the family home, there might not be any need to hold on to as much space.
It’s a common assumption that moving later in life means downsizing, but in a survey of 2,000 homeowners carried out on behalf of Hargreaves Lansdown in 2021, only 22% of respondents said they intended to move to a smaller property when they retired. Just over a third said they definitely wouldn't and the remaining 44% hadn’t decided one way or the other. And that’s not surprising because if you’ve been used to a certain amount of space for many years, it can be hard to think of living with fewer and possibly smaller rooms, as well as having to part with furniture and other possessions.
However, there’s much more than size to consider when choosing a home in retirement, especially if you intend for this to be your last big move. If you’ve recently retired or it’s on the horizon and you’re starting to look at your options, here are some of the main things to think about:
Location and lifestyle considerations
There are two aspects to choosing your location: who do you want to have nearby, and what facilities do you want or need within easy reach? Being close to family and friends is the biggest priority for most retirees, but you’ve also got to think about what’s on your doorstep in terms of healthcare, shopping, leisure facilities, green spaces, and transport. Driving might be easy for you now, but it’s sensible to have all your essentials within easy striking distance, including train and bus or other public transport routes, in case you can’t drive as you get older.
What type of property is going to suit you?
In terms of property types, you now actually have more choice than ever before. In addition to ‘open market’ houses, flats, bungalows, etc., once you’re over 55, you become eligible for specialist housing options, including retirement villages and shared ownership that’s designed specifically for older people (England only).
Even if you’re physically fit and healthy at the moment and your instinct is to have a house, the reality is that we all become less able as we age, so it’s worth looking at single-storey properties. And although you may have enjoyed living in period homes until now, it may be time to consider something modern that has guarantees and warranties, is energy efficient, and will require far less maintenance.
Then really think about the number and type of rooms that you’re going to need. In addition to your own day-to-day living requirements, how much space do you need to accommodate family and friends when they visit? And what about a home office or study? According to a survey by abrdn, two-thirds of people starting their retirement in 2022 did not expect to give up work completely, partly due to the surge in living costs, with a quarter planning to work part-time and one in ten wanting to start their own business. Even if you don’t work anymore, many people find it useful to have a specific room for personal admin and hobbies, so make sure you don’t leave yourself short on space, even if you are downsizing.
If you’ve been a homeowner for more than 25 years, it’s likely you will have paid off the mortgage on your current home and be looking to buy ‘all cash’. Given that bungalows and other popular retirement living options are less commonly available than the kind of flats and houses working-age people generally choose, being able to buy without a mortgage – particularly in the current climate – may give you an advantage over other potential buyers.
On the other hand, if you still need a mortgage, speak to a financial adviser or broker as soon as possible to find out what affordable options are available to you – these could include a retirement interest-only mortgage or an equity release ‘lifetime mortgage’. To discuss financing for your next home, you can easily arrange an appointment with our partners at Mortgage Scout via their website.
You also need to make sure that it’s affordable not only now, but into the future. So if you’re buying a leasehold property that has service charges, make sure you understand how those might increase over time, and consider what kind of investment you might need to make into maintenance and repairs over the next 20-30 years. Importantly, if you’re planning to leave the property to loved ones, speak to a legal expert to make sure it’s owned and can be passed on in a tax-efficient way, and do check whether there are any restrictions on selling.
If you’d like to talk through your plans and find out what potentially suitable properties are currently available, just get in touch with your local branch in Cyncoed, Pontcanna, or Roath and one of our property experts will be very happy to help.