Downsizing explained
What downsizing involves, the potential benefits, and things to consider in later life.
Downsizing involves selling your current home and moving to a smaller or less expensive property.
​
For some people, downsizing can free up money, reduce ongoing costs and simplify later life. For others, it may not be the right choice. Understanding how downsizing works — and how it compares to other later-life options — can help you decide whether it’s worth considering.
What does downsizing mean?
Downsizing usually means moving from a larger or higher-value home to a smaller, more manageable, or lower-value property. The difference in value can release money that may be used to support later-life needs.
Downsizing can involve moving to a different area, switching property types (for example, from a house to a flat), or choosing a home that better suits future mobility or lifestyle needs.
Why People Consider Downsizing
-
To release money tied up in their home
-
To reduce household running costs
-
To move closer to family, support or amenities
-
To live in a property that is easier to maintain
-
To avoid taking on new borrowing later in life
​
The reasons for downsizing vary, and what suits one person may not suit another.
Potential benefits of downsizing
-
Access to released funds without borrowing
-
Lower ongoing costs such as utilities or maintenance
-
Greater flexibility compared to long-term borrowing
-
Opportunity to choose a home better suited to future needs
Things to consider before downsizing
-
Moving costs, including legal fees and stamp duty
-
Availability and suitability of alternative properties
-
Emotional attachment to your current home
-
Impact on family and support networks
-
Whether downsizing aligns with long-term plans
​
Downsizing is a significant life decision and can involve practical, financial and emotional considerations.
How downsizing compares to other later-life options
Downsizing is one of several later-life options available to homeowners. Other approaches may include equity release, retirement interest-only mortgages, or using savings or pension income.
​
Each option works differently and has its own advantages and risks. In some cases, downsizing may be more suitable than borrowing. In others, alternative options may be worth exploring.
​Is downsizing right for you?
Downsizing is not the right choice for everyone. Factors such as your age, income, health, family situation, property value and long-term plans all play a role.
​
Understanding how downsizing compares with other later-life options can help you decide whether it’s worth exploring further.
Free to use. No obligation. We do not provide financial advice.