Rise in homeowners who plan to downsize property

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The number of people looking to downsize their home is nearly double that wanting to buy a larger property, new research revealed today.

Britain’s ageing population as well as a squeeze in lending are thought to be driving this trend, according to property website Rightmove.

Meanwhile, demand from first-time buyers continued to fall after the stamp duty holiday on homes between £125,000 and £250,000 expired in March.

Only in London was there more uptrading activity, bolstering evidence of a two-speed housing market in the UK, Rightmove added.

Miles Shipside, Rightmove director, said: “The ability to trade up is a vital component of a healthy housing market. There are more old people at the top of the chain trying to downsize and fewer at the bottom trying or able to trade up.

“Some people may be facing redundancy and looking to reduce their outgoings, and others may be looking to supplement their underperforming pension pots.”

He blamed borrowing difficulties for those looking to trade up for widening the mismatch, and warned that a Greek default could further reduce mortgage availability.

He said: “With overall market volumes already in the doldrums, we need a fair and consistent wind of mortgage lending to prompt a speedier housing market recovery.”

This effect is weaker in the capital which has a higher concentration of wealthy homeowners who can afford to upsize. Mr Shipside also predicted a boost in the London housing market from foreigners looking for safe property investments as the eurozone crisis unfolds. The survey comes as flat average asking prices in May bucked the trend of a buoyant spring market. Average asking prices usually rise between April and May, but this year they remained stagnant at £243,759, only £22 higher than last month. Mr Shipside also expressed concern that the early spring slowdown may run seamlessly into a longer summer lull created by the double effect of the Queen’s Diamond Jubilee and the Olympic Games.