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  • Cost of moving and not being able to find a suitable home are the main reasons for not going ahead
  • Nearly one in five equity release clients see their homes valued at less than they expected 

Nearly one in five would-be downsizers change their minds and decide to release property wealth through equity release, research* from national specialist Bower Retirement shows.

Its Adviser Tracker Research found that Bower’s specialist advisers estimate around 17% of their clients have tried downsizing before switching to lifetime mortgages to raise cash.

They are deterred by the potential cost of moving with 55% of Bower advisers saying customers change their minds because of the expense of moving. However around two out of five (43%) advisers say clients could not find a suitable house to move to.

Emotional reasons are also a major issue for not going ahead with downsizing with around half of Bowers’ advisers saying clients did not want to move away from family and friends.

The gradual slowdown in the housing market – house prices have fallen for three months in a row for the first time since 2009 according to Nationwide** – is also having an impact. .Bower’s advisers say around 17% of equity release clients see their home valued at less than they expected.

Andrea Rozario, Chief Corporate Officer at Bower Retirement said: “Downsizing is logical and sensible and can work for some over-55s homeowners but only if they can find the right house at the right price.

“But there are financial issues to deal with when moving house with stamp duty alone costing 5% on house prices above £250,000 which can make the decision to move uneconomic. Buying a £300,000 home would cost around £5,000 in stamp duty.

“It is also not just a financial calculation as there are emotions involved when moving home with the risk of losing touch with family and friends making downsizing seem a bad idea for many.”

Bower Retirement is focusing on increased use of technology and service for customers and partners as it focuses on continued growth and recruitment of advisers.

The firm has enhanced its service for the growing retirement planning market with the launch of new online tools. New services include video guides for customers and potential new recruits as well as online chat services for customers and a focus on ensuring customers are offered as wide a range of solutions as possible. Videos are hosted on YouTube

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