Thousands of homeowners across the UK are preparing to trade larger family homes for smaller properties as financial pressures mount, new research shows, signalling a shift in behaviour that is increasingly driven by necessity rather than choice.
A nationwide survey commissioned by Sold.co.uk found that 42% of homeowners considering downsizing cited money worries as the main motivation for moving, underlining how the cost-of-living crisis is reshaping the housing market.
Traditionally associated with retirees seeking to release equity or simplify their lifestyles, downsizing is now extending across age groups.
According to the poll of 1,004 homeowners conducted by Obsurvant, a quarter (24%) expect to move to a smaller property within the next decade – including 27% of men and 22% of women.
FINANCIAL STRAIN DEEPENS
More than a third of those planning to downsize (34%) intend to do so within the next year, suggesting that financial strain is prompting near-term decisions.
The survey also found that homeowners aged 45 to 54 were most likely to cite cost pressures, with almost half (47%) identifying finances as the key factor.
The findings come as mortgage affordability reaches its weakest point in more than a decade.
According to data from Moneyfacts, a typical middle-income earner now spends around half of their gross salary on mortgage repayments for a medium-sized home – a proportion that has doubled since the era of ultra-low interest rates.
The combination of elevated borrowing costs, high inflation, static wages and rising household bills has left many families reassessing both their housing needs and financial resilience.
CROSS-GENERATIONAL TREND
Matt Gerrish, Property Expert at Sold.co.uk, says: “It has been a rough ride for homeowners over the past few years. Not only are financial pressures forcing people to make their lifestyles more manageable, but the market is not helping.
“Mortgage rates have crept back up, and those who became used to ultra-low interest levels are now facing much higher monthly payments.”
While older homeowners remain the most likely to downsize – with 69% of those aged 55–64 and 63% of over-65s planning to do so – the research suggests the trend is spreading to younger age groups.
About a quarter of 18–24-year-olds and 25–34-year-olds are also considering moving to smaller homes within the next decade.
For these younger cohorts, the motivations are largely financial, with between 60% and 78% citing cost and lifestyle pressures as key drivers.
Other motivations include lifestyle adjustments (48%), children leaving home (32%), and the desire to release funds for retirement (31%). A smaller number are planning to downsize to release equity for family gifting (16%) or major purchases such as holidays (14%).
SHRINKING HOMES
The results point to a broader recalibration of housing expectations amid prolonged economic headwinds.
Gerrish says: “Whether it’s a couple moving from a three-bed semi into a modest flat, or young professionals scaling back before they’ve even climbed the property ladder, Britain’s smaller homes reflect a larger reality. The nation’s financial comfort is shrinking just as quickly as its living space.”
