For some, skyrocketing property prices are making it borderline impossible to relocate. For others, it is more a case of not wanting to abandon everything they have worked hard to make their own over the years.
Motivations and justifications vary, but the popularity of ‘rightsizing’ is at an all-time high across the UK.
The COVID-19 pandemic has resulted in more UK households than ever before reconsidering their priorities. Spending more of their free time at home and, in many cases, now working from home, we are being forced to rethink the potential value tied up in the homes we live in.
According to economists, that is one of many reasons why equity release application volumes are likewise hitting record numbers up and down the country.
The ‘rightsizing’ phenomenon
Downsizing has traditionally been a popular choice among retirees, those approaching retirement, and individuals looking to retire early. You decide your current home is not suitable for your needs, so you set your sights on something smaller, with the potential to free up some cash while doing so.
Nevertheless, the appeal of scaling things down to fit into a smaller home is far from universal. The prospect of going through the selling and relocating process in general can also be off-putting.
An increasingly popular alternative to the above, ‘rightsizing’ is all about making the best of the home you currently live in.
From major interior renovations to the construction of extensions and comprehensive exterior landscaping works, there is much that can be done to improve the appeal and enjoyment of your existing home. Even something as simple as the addition of a conservatory coupled with a new kitchen could really make all the difference.
In any case, rightsizing is almost always cheaper and easier than moving.
Tapping into your home’s equity
The options available for funding projects like these are also broader and more attractive than they have ever been. Among retirees and older homeowners in particular, equity release is growing in popularity like never before.
Equity release involves taking out a lifetime mortgage against the value of your home, which is subsequently repaid when your home is sold (either at the time of your death or when you move into permanent care).
You are handed a lump sum based on the value of your property and the size of the loan you need, or you can opt for a long-term series of monthly instalments. In both instances, the money is yours to use in any way you like. Major home improvements are a popular choice for many equity release customers.
After which, you are free to continue living in your home exactly as before, with no monthly repayments to worry about.
Consult with a broker before applying
If you are interested in an equity release, it is essential to consult with an independent broker in advance. This will enable you to find an unbeatable deal from a reputable lender while at the same time verifying equity release as an appropriate product for you. You can even use our mortgage calculator in the UK to find out the exact costs.
Most lenders impose very few restrictions with regard to how the funds can be spent, though this is also something to verify before going ahead with your application.