When I suggested recently that more pensioners might downsize in retirement to unlock spending money and reduce their outgoings, I also adopted the brace position.
However the expected barrage of age-appropriate invective never came.
Sure, the odd pensioner hefted a verbal brickbat in my direction.
But overwhelmingly the replies were thoughtful, proportionate.
Dare I say worldly-wise.
Partly to honour such inter-generational reasonableness – but more because it makes for a good counterpart to my piece – I’ll highlight their counterarguments today, out of the mouths of not-so-babes and Werther’s Original-sucklings1 …
Size isn’t everything
The lengthiest reply came from John over email. Here’s his full note, with a few light edits for clarity:
Hi Investor
You are preaching to the converted. There is no question that the young (in general, like you I am not wanting to feather bed the shysters) are getting a bum deal.
Particularly the young whose parents do not own a house with equity, giving them the ability to support their kids financially.
We, personally, have been lucky and done financially much better than we could have hoped when we were young.
Housing has been a significant element in that; not just the money, but the physical comfort, self-confidence, and status which goes with it.
These incremental benefits have a cumulative beneficial effect. House purchase was the basis on which my parents, who bought their first house in the 1950s, were able (along with being penny-pinching savers) to provide us with a deposit for our first flat. And it’s enabled us to do the same for our children.
It was always drilled into us that the only debt we should have was a mortgage for a house. Only houses were ‘as safe as houses’. The risks in buying a house were regarded as negligible, so it is difficult to understand why some regard their primary or only house an ‘investment’.
Sure there are some risks, and certainly differential returns, in owning one house rather than a share in the whole housing market.
Our experience illustrates this:
- Our first property, three-bed flat on the borders of Brixton and Clapham, cost £6,500 in 1971 and our mortgage was £4,500.
- Today it would be valued at about the same price as our five-bed house with good garden in a small town in the East Midlands; we had a £50,000 mortgage on that when it was built for £87,000 in 1987.
At the risk of providing you with too much information:
We are 77 years young, fit and well, and our house might be valued at the average you quoted in your piece. We justified building a house on this scale 35 years ago on the grounds that we had four children at home, but I don’t think they would have suffered if they had had to double up.
The other reason was that we found a plot in the middle of a small town from which the kids could walk or bike to schools and recreation. We had previously been in Manchester, where we parents operated an intensive taxi service for our young kids.
We are likely to remain in this house for the foreseeable because:
- We have no compelling reason to move elsewhere.
- Why should we sort out our junk? The kids are already estimating the number of skips that will be required when the time comes and they won’t be arsed to sort it all. Their houses and gardens are already full.
- It is handy to have the space when kids and grandkids visit. They still do visit and we like to think it is not just to review what they think may be their inheritance. We have explained that we think there are a number of better causes than them which will benefit from our estates unless our funds are consumed by care costs.
- We can afford it: comparatively good standard of building and insulation; property taxes do not reflect the value of the property; paying for gardeners, when we cannot cope alone, will be relatively low-cost. The tax system has massively favoured home owners: I seem to remember getting tax relief on mortgage interest payments in the 1970s. Further, a lot of our income is from ISAs on which we pay no tax.
- Our current location will allow us to get to supermarkets, several pubs (you always need access to more than one in case you get banned from one) and restaurants on the level if we are reduced to using zimmer frames. Most of the three-bed houses in the town are much further out of the centre.
- At present (we hope it changes in the budget) there is an inheritance tax benefit in leaving a house valued at up to £1m to our descendants.
As with marriage, there’s a lot to be said for sticking with what you’ve got to minimise both mental and physical effort and cost. I like to think such inertia is the product of a relaxed approach and if that signifies a lack of ambition to strive for perfection, then so be it. ‘Good enough’ was the standard applied by my social worker wife when considering whether children should remain with their parents.
I am grateful for your newsletter. You find fresh ways to express eternal truths/values as they relate to money and explain them in the context of the realities of the current marketplace.
Regular reminders help to keep me within sight of the straight and narrow.
All good wishes,
John
I can be annoying to have everything you put into print these days nitpicked over in the comments, compared to 25 years ago when you could loftily opine in peace.
However the big benefit of our interactive era is the relentless reminders that your readers are real people, with their own perspectives, hopes, and concerns.
My thanks to John for taking the time to reply with a thoughtful case in point.
Compromising positions
Several other stalwarts of our Monevator discussions also admitted to staying put despite seeing reasons to downsize in retirement.
Long-time reader and contributor Naeclue conceded:
Guilty as charged. Six-bed house and kids have all moved out into their own homes. Not much of an excuse, but we do entertain quite a lot and all bedrooms are used at Christmas.
I have been trying to think what stops us from downsizing. A few things come to mind. We absolutely love the area, having a lot of friends and two of our kids nearby, so we would want to stay in the area.
Three or even four-bed houses locally all tend to have smaller rooms and lack off-street parking. Our preference would be to have a similar house to our current one, but two stories instead of three. […]
Moving is very expensive and a lot of hassle, so we would want to get it right if/when we do eventually move.
Meanwhile Paul_a38 flags ups the uncertainty of end-of-life spending as a reason to stay put (especially relevant given your own home is excluded from means-testing for the entry levels of social care):
I have just seen a second acquaintance beggared by care costs (24 hrs live-in). Budgeting for deep old age is difficult.
Think their care costs were about £150k per year. If you are selling investments subject to CGT, to fund that £500k won’t go far.
Who am I to disagree with such choices? Given the very favourable tax treatment of one’s primary home, even being house-rich and cash-poor may be a reasonable path for those whose primary concern is the ultimate distribution of wealth to their heirs.
But again, that doesn’t imply the government should support such personal preferences against what we must resort to calling the national interest.
Housing stock is in short supply and – in terms of function, not ‘fairness’ – it’s imperfectly distributed.
Subsidising pensioners to live in big houses shouldn’t be on the government’s agenda.
Hands off our homes!
The philosopher David Hume wrote: “It is not contrary to reason to prefer the destruction of the whole world to the scratching of my finger.”
Similarly, a reasonable Monevator reader can see that our housing situation is untenable for young people, and that living in a five-bedroom house as a couple or even a singleton is a more egregious luxury than, say, buying a Hermes handbag, given the knock-on effect on others as a result of finite housing supply.
Yet at the same time that reader can still, understandably, not be arsed to move, for their own sake – for liquidity or lower bills – let alone for others.
A couple of readers did take the shortcut to outrage.
Jibber wrote:
This is like reading something from a socialist magazine. How dare anyone suggest that the retired should be taxed (nudged) out of their family homes? What happened to this ‘free country’!
Jibber then raised the ‘I’ve paid my taxes!’ argument that I anticipated as the cousin of the same retort deployed against inheritance tax.
Note I never suggested paying more tax – or even taxing pensioners more at all.
The only concrete policy action I endorsed was not paying them extra cash to heat their roomy homes via the now-restricted Winter Fuel Allowance.
First they came for the Winter Fuel Allowance…
Another reader sporting an offaly good name, Gizzard, made this more pertinent point:
I suppose it’s not a giant leap to means test the hitherto universal state pension. A lot (or even all) of the same arguments apply.
It’s a fair comment – and it can be made whenever a universal benefit is taken away and replaced with some kind of qualifier or means-testing.
But then, exactly the same argument could be made when, say, income tax is raised by 1% (“Why not 100%”) and we’ll surely hear it if capital gains tax is hiked in October too (“Why not take all my gains”).
Yet most of us would see those counterpoints as an absurd overreach, and I think the same is true of objecting to restrictions on the Winter Fuel Allowance on the grounds of ‘what next’?
It’s a one-off tweak and well-targeted, not necessarily the thin-end of a Titanic-shaped wedge.
Pensioners will always be the biggest voting bloc, remember, and all of us hope to end up there. The State pension is surely safe.
Cold shouldered
Away from the downsize in retirement debate, Wireless worried that withdrawing the Winter Fuel Allowance from some pensioners could result in actual pensioner death.
I have my doubts about this, given the means-testing, but it’s obviously a fair concern.
On the other hand, regarding their parting shot…
The WFA money that was to have been paid to pensioners will presumably go towards the higher than inflation pay deals for public sector unions.
It is obvious where Labour’s priorities are!
…all I can say is “I hope so”.
To paraphrase Jabba the Hutt, your pity-the-poor-pensioners mind tricks don’t work on me.
The government has favoured pensioners for too long. To begin with, when the Coalition government introduced the triple-lock, it was fair enough. Pensioners had fallen behind.
But that’s no longer true.
In contrast, the public sector has been starved of funds for the better part of a decade.
And while like most of you I don’t long for more £75,000-a-year Executive Manager of Ensuring Cultural Sensitivities are Respected in All Outgoing Correspondence: Latvian Language officers or whatnot, such positions are trivial outliers in reality. (And some may be more useful than they seem, too, for that matter).
Spending a bit less on pensioners and a bit more on frontline public sector wages, particularly for the young, junior, or lowly-paid?
Count me in.
Give and take
Dread of theoretical worse-case scenarios shouldn’t stop us finding a middle ground.
On that note, a few readers said we need to tweak the system if we want to encourage more downsizing.
Stamp duty is seen as a big roadblock, as well as that shortage of appealing final-stop homes I mentioned in my piece.
Perhaps there’s some merit to the idea of cutting stamp duty for downsizers as perennially floated by the usual suspects?
Better still, get rid of stamp duty altogether – it’s a frictional tax that impedes growth, and works against the easy mobility we’d prefer to see – and replace the lost State income with a more useful levy.
Or – just maybe – see the total tax take remain relatively unscathed, if freeing up the housing market boosts GDP and overall tax receipts to compensate.
Downsize in retirement and run with it
Regular Monevator comment readers will know Mogul member Delta Hedge has become a vital contributor of context, links, follow-ups, and general value-addery.
This time around, Delta Hedge took the downsizing idea and ran with it:
Why stop at downsizing within the UK?
That £1.7m five-bed average London home shown in the table probably cost just £150,000 at the lowest point of the 1990-95 crash. With a 90% mortgage some people are sitting on 100-baggers, and all tax-free due to PPR relief.
Sell that and move to Panama, Bolivia, the Philippines, Portugal, Malaysia, Mexico, Bali, Thailand, or Vietnam.
You can live like royalty and never need worry about qualifying for the Winter Fuel Allowance.
It’d tempt me. Though as Wodger alludes to in his reply, it’s rather late in life to making new friends in Thailand, say. Especially given the unsavoury nature of at least some of your would-be pensioner peers out there.
Better to go in middle-age – maybe as a geo-arbitrage – and to make proper friends with the locals.
Another alternative if you don’t want to downsize in retirement
To conclude on the social aspect, I didn’t mention another strategy, which is to stay in your big house but to share it more widely.
In the US some call this: getting a boommate. To which I say: nice work punsters.
Having shared until into my 40s for FIRE-ish reasons, I know well how every extra pair of hands putting money into the communal pot makes a big difference to the running costs of a household.
But whether you want to spend your golden years turfing a fellow OAP off the sofa so you can have your own turn on Netflix will be a personal decision, obviously.
Given the introverted nature of most Monevator readers, I suspect many of us would rather downsize to a dog kennel.
It has to be admitted though that the health benefits of living a more sociable retirement ring loud and clear in the research data I’ve seen.
If sharing your home does appeal more than downsizing to you, then don’t forget the UK’s rent-a-room scheme enables you to earn £7,500 tax-free from a lodger.
You could even choose a hard-pressed student instead of an out-of-breath oldie as a roommate to better stay in touch with the younger generation.
Such intergenerational mixing also has proven benefits. I suspect it’s especially good for warding-off crotchety old man syndrome for those of us – like me – who don’t have kids of our own.
(Those with kids might have seen them boomerang back home anyway, I guess…)
Like, comment, and subscribe
If you want to keep your home your island, then by all means you do you.
I’d feel the same nowadays.
But at least be a little more social by reading – and even contributing to – the Monevator comments.
This thread on downsizing wasn’t even on investing specifics, yet it still added a lot to anything interesting I wrote in the article.
Indeed I collated lots of other reader comments to include in this summary. From critiques of the mechanics of the Winter Fuel Allowance withdrawal to proposals for replacing stamp duty and council tax with a wealth tax.
But at this point you’re best off just reading the comments for more.
Many subscribers to Monevator by email never visit the site anymore. Feedback over email reveals more than a few of you have forgotten there’s even a website behind your three-times-a-week emails!
On the other hand, other readers have said the Monevator comments are the reason they keep coming back to our site, for years on end.
I’m happy to downsize my ego and say: long may that continue!
As to whether you should downsize in retirement – I’ll see you in the comments for the next round…
- Don’t be cross, I’m just having fun with stereotypes and am partial to them too! [↩]
Interesting topic, in principle the case is a strong one just less than obvious how to fairly encourage it from a policy perspective. Wielding a stick in this context does seem harsh presumably it would have to be some form of stamp duty like carrot. I’m always surprised by data on the number of empty properties be it under-utilised second homes or London property owned as a store of value but not let etc, perhaps a bit more stick is justified there.
I have a small one bedroom flat. No downsizing privilege for me then.
One thing that I do not understand that was not mentioned in the article (or maybe I have missed it?) is attachment.
Just imagine living in the same house for decades and now, in your old age you have to go through the stress of relocating to the property which may/may not meet your needs (because you cannot know everything about the place up front before you press buy button). Imagine you have to leave big chunk of your life behind. I would think, this is not the position most old age people want to be in. Attachment to the place/house that someone was brought in is a big thing and beyond the value of money.
Maybe this is the reason why some old people in Ukraine refuse to be evacuated when Russians will be there any minute. Almost like relocating is no better than death for them. So I cannot imagine UK retiree would downsize (basically same as relocate) because of social responsibility or even when he cannot afford to heat his to big house.
For this attachment reason, I am not a fan of WFA being taken away from people who have a big house but are cash poor.
A further factor for us not downsizing was the worry of discovering smags or issues with new property after purchase – you can only research and investigate so far and cant always count on a survey to fully reveal all. Better the familiar property you know and which you have looked after for some years.
@Peter — I agree attachment is a big issue. However it’s not insurmountable. Basically as I discussed in my original article, the move to appropriate late-stage-life needs to be done earlier, maybe by mid-60s as opposed to being thought too-late by the mid-70s.
I appreciate this is potentially a bit depressing, which is why I spoke in my first piece about how we need more really attractive and functional housing for these older generations to age in place.
Yes, you give up something when you leave a home with three bedrooms you don’t use and a garden you can’t manage that’s full of memories.
But if you moved to really a really attractive and modern worry-free purpose built apartment with a balcony/patio garden, near medical facilities, with gorgeous easy-access communal grounds, a great cafe, sports facilities, an ability to opt-into or be completely oblivious to various accessible activities — and with another £200,000-500,000 to spend on travel / eating out / a dream car / your grandkids / your favourite cause, you’re getting something in exchange.
Do it before it’s too late is my thought.
@JP — Hmm, we have an edit facility nowadays? Anyway no worries I trimmed the comment and deleted your follow-up just for tidiness sake.
Another reason for staying put, the garden.
Having spent decades getting it ‘just so’ you really don’t want to downsize to a balcony until the choice is made for you.
Someone will need to call me out on this in a few years….
Mrs KeepOn wants to have space to have the 3 kids back to visit – is open to moving – but is choosy (not many possibles make the cut).
We are minimum 2 years away from reviewing if we sell.
Approx. 8 months to pulling plug & will be refreshing house etc. over next 12-18 months. Key factors then will be 1. Where are the kids relative to us? 2. Old folks still with us – where? 3. Is social circle unchanged (bunch of us pulling plug on/near same time)?
We will look to unlock £300-500k from sell up (don’t need to move far to unlock due to good schools/28 mins into London) – but move costs also something to build into the final go/no go.
Conceptually – we get it – as would like to unlock more capital in the go-go years (kids might even get a chunk). However, I think actually doing it will be a different ball game…..
Always good to hear where others are at/thinking/done – even though we all have our different needs, wants and “isms”!
The parents of a friend of ours sold up in Adelaide, South Australia, to move to Far North Queensland to be near their daughter. Then she moved to Sydney.
Being near your children can be a moving target.
I once suggested to a friend that if he wanted to see a lot of his grandchildren he should buy a house handy for Stansted airport and equip it with a large swimming pool.
Many years ago -newly married with a small cottage -2 bedrooms only -eventually added one more room-had 3 kids -never upsized further
Never built a garage etc
Unfashionably concentrated on savings-ISAs and Pensions-our peers were into property ie their houses
Also put a lot of work into the kids to render them self sufficient-expensive-luckily it worked
Cottage now more than adequate for a couple in retirement -can afford to heat it etc etc
54 years now in same house -won’t be downsizing !
Though kids all far away-visit us regularly-social network in place-plan to not move till death or nursing home but circumstances alter especially when only one partner left
The end game is very much in the lap of the gods as the ageing process does its inevitable thing
xxd09
A garden doesn’t stay ‘just so’ for long once you haven’t the energy to maintain it (or arrange for someone else to- easier said than done ime)
Since many do stay put, what would be really interesting is some proper research into why. From personal experience a lot is due to the energy required to move and re establish social networks- hard enough when it’s forced on you, so why choose it? Then the other is the comfort of the familiar, and the fact that an elder care apartment isn’t ever going to have the emotional pull of the family home
Feeling somewhat called out on your introvert point! 🙂
It’s an interesting point though. I’m in a relatively big house so could survive losing a couple of reception rooms and a bedroom or two, but even if I downsized I’d still want to be in a detached house. Muscle memory associated with living in flats with noise travel etc etc means I’d dread that outcome, even if it would give me a fairly decent pile of cash.
Downsizing to something smaller but still detached probably wouldn’t release *that* much money if I stay in the same area, and the fixed costs/stamp etc + stress is still there. And as a clincher – I think I’d end out in a bungalow with about the same footprint as the downstairs of my current house. So just designating the upstairs bedrooms ‘guest rooms’ and moving my bed downstairs seems to have much of the same practical outcome to me at none of the cost…
On doing a geographical/geo-arbitrage: this can be a win-win-win.
Net additional house becomes available in UK (as you’d be leaving the country). This ultimately helps new buyers.
You gain from the difference in Purchasing Power Parity by moving abroad.
If the new country has a lower nominal GDP per capita it gains wealth from having you.
What’s not to like?
According to the IMF October 2023 World Economic Outlook:
“Out of 195 countries/economies, 182 have higher GDP on a PPP basis, and 12 have higher nominal. For the United States, both are identical. Sudan has highest difference between PPP and nominal GDP [6x greater than nominal]. 8 countries have PPP to the nominal ratio between 4-5, and 24 economies have higher PPP values above 3 times. This value is lowest for Norway (0.737).”
For Turkey, a popular tourist destination from the UK (so why not live their in retirement?) the ratio is 3.7x, and for the UK it’s 1.2x (largely reflecting the battered post-Brexit GBP/ USD exchange rate).
For example, downsize and then move to Turkey and every £100,000 you free up here in the UK has the purchasing power of £290,000 in Turkey.
Typo: £310,000 not £290,000.
Travelled extensively in Retirement-Far East,Middle East ,South and North America,Europe,India,China ,Central Asia ,Africa etc
Greatly enjoyed the experience …………but
why any Brit would want to live outside the U.K. beats me
All these foreign countries have their advantages but their downsides are a game changer.
Healthcare is a massive financial burden for most outside the U.K.
Rule of Law is problematical in most countries .Levels of wealth disparity are just sad etc etc
We underestimate our culture and of course the current climate denigration of our country is the standard mantra-“racist buildings “ in Wales being one the latest manifestations
We love to travel but each time coming home reinforces how lucky we are to be living in the U.K.
xxd09
Worth also saying that families are getting smaller. Two parents plus one child are going to rattle around some of these homes as much as an older couple might do. I know some with big houses are dividing them with a view to share them with family members.
A childless couple, we bought our only house (3BR – but two of them are very small, barely fit a single bed in them) we felt we would stay in for the duration. Cheaper to run and maintain. If it becomes too difficult, we will simply close up some rooms or potentially offer them to local students – perhaps in exchange for some help around the house. Unless dementia or other special needs strike – I don’t imagine leaving unless in a box.
@Delta Hedge
Re: What’s not to like.. ?
Long ago, after 4 years of living and working in Borneo, all I wanted to do was fly into Heathrow at 7.30 on a slate grey February morning, drive to Hampshire, sit down in my own home, with a fish supper in my lap, and watch Auf Wiedersehen Pet Pet on TV. I just grew tired of the difference of cultures, the heat, the humidity, autocracy.
Other countries.., add in coups, risks of natural disaster, and sundry
other less wholesome aspects. In Borneo, as I recall, there were 17 native species of snake. Fortunately, only 16 were deadly poisonous.
@xxd09, trufflehunt: looking in the mirror, can you both honestly say that the UK is (currently) the best country that you could have lived in, out of all the world’s 195 nations, and with the rest of them making up >99% of humanity’s 8 billion headcount and >99.8% of the Earth’s land area outside of Antarctica (some 135 million square kilometres, against the UK’s mere 244,000)?
Isn’t there just a little bit of home country bias here?
I’m not saying that the UK (despite a lot of relative slippage over the past 30 years) isn’t ahead of most countries in terms of socioeconomic development.
Nor am I discounting the benefits of the NHS, living in a country sharing your native language, or the issues around both the existing climate and climate change (with South and S.E Asia, the Middle East, the Shael and Horn of Africa likely to be the most negatively affected; and Scandinavia the least).
But it seems a stretch that we live is the best of all possible countries we could have lived in.
And looking at the UK these past 8 years I’m not sure I rate its stability and its respect for the rule of law quite as highly either.
Given the stark difference in purchasing power between many countries, moving abroad must have some merit as an option.
I imagine that the hundreds of thousands of Brits who moved to Portugal and Spain since the 1980s thought so.
Without out a shadow of a doubt !
Now very old(78) and perhaps more experienced than some of life and its vicissitudes
We all take our country for granted sadly as is very human so to do
Those of us who have lived longer and got out more really appreciate what we have in Britain -our world wide travels have only reinforced that our culture is second to none in multiple ways especially to the poor and unfortunate-no mean feat in the very tough world in which we live
Pounds,shillings and pence are really the least important part of a successful life( having “enough “is of course a requirement)
xxd09
Well, not only am I not downsizing as I approach old(er) age, I’m upsizing! From a 2-bed London flat to a 3-bed house in a lovelier part of the UK. My current flat has no outside space, is in a busy area (lots of noise and road pollution), has only one spare room so child and grandchildren can’t come and stay, and the only loo and bathroom are downstairs. Additionally, the quality of local council services, driving behaviour on nearby roads, and the social norms of the neighbours in my immediate environment have all declined markedly over the last few years. My new house has outside space, enough room for family to visit, bedroom and bathroom downstairs as well as upstairs, is nowhere near a busy road, in a nice civilised leafy area just 10 minutes’ walk from the centre of town, and where surrounding houses cost a fortune so I doubt I’ll be phoning the council once a week about fly-tipping around my building (as I currently do). My new house costs 66% more than I’m getting for my flat, but I can afford it and still live a reasonably comfortable life with plenty of travel etc, and being able to live out my final decades in some ease and comfort is precisely why I’ve spent all those decades of my adult life up till now living frugally and in 2-bed flats or small 2-bed houses. You can slum it when you’re younger; it would be miserable having to try to do it in old age.
@The Investor (#4)
When you say “But if you moved to really a really attractive and modern worry-free purpose built apartment with a balcony/patio garden, near medical facilities, with gorgeous easy-access communal grounds, a great cafe, sports facilities, an ability to opt-into or be completely oblivious to various accessible activities — and with another £200,000-500,000 to spend on travel / eating out / a dream car / your grandkids / your favourite cause, you’re getting something in exchange.”
Yes, those places exist. And they do offer what you say. And they have a service charge to match (you’re basically robbed blind) – so if you think you’ll have cash left over to spend on travel / eating out / a dream car etc, unless you’re *seriously* wealthy, that’s not going to happen.
We are in our seventies and are very attached to our present house. Our son persuaded us to move closer to our grandsons. We decided to downsize and move close to them in beautiful part of the Surrey. We bought a small bungalow that needed some renovation work done to it. Our builder Kevin took mostly of our money without completing the work and we have no money left to hire another builder to complete it.
We already paid double the stamp duty as we have not sold our current house yet. I am writing here to make your reader to be very aware, we now know its very common due to shortage of skilled labour.
@Onkar
I’m sorry to hear about your cowboy builder. Have you thought of taking him to the small claims court to get your money back? You don’t need a lawyer and it doesn’t cost very much. You can find books in your local library that will help you to understand the process and how to put a case together, it’s really not difficult. More information is here:
https://www.gov.uk/make-court-claim-for-money
@TI both these articles have been excellent and I especially like your inclusion and commentary on the responses to the first one. I think it’s a really big deal on both a personal and societal level. I joke about being in our family house till we die or they put me in a home but recognise the challenges. As others have said location of friends and family is a big factor combined with the lack of materially better alternative properties.
@dearime – I’ve seen the same happen. Your Stansted / swimming pool comment made me properly laugh out loud
While I don’t support the idea of “forcing” older people out of their homes, I do think there is merit in changing stamp duty/taxation to provide incentives to freeing up much needed housing stock.
At the same time we need to build many more houses and not be constantly hampered by nimby-ism. Existing homeowners older and younger all too often seek to block developments and forget that their house was once also on valuable green space….
As a non-player of the kids game (never planned it that way just never worked out with the right partner at the right time) I must admit that I’d rather assumed that any advantage in what e.g. a single/couple built up in enhanced savings rate etc was rather neutralised by retirement age by the capital gains in larger property wealth from those who needed space for families. And further that those who put up with the crap of living in big cities for decades would be more than happy to move out when no longer working.
It seems that many though remain anchored to their home thus never get the benefit in their lifetime of realising such gains. At least their kids probably will (subject to IHT).
I like the idea of keeping a larger home because if your kids end up caring for you (or perhaps an in-home aid) you have room to live together. It’s entirely likely the kids don’t have the room to move you into their home.