UK households who have 'three or more bedrooms' isssued £498,687 warning

Homeowners can boost their retirement pot by £500,000 by downsizing. Homeowners in London could earn the highest return, gaining almost £1.1million in cash on average by downsizing, property experts and housing analysts have explained amid the Cost of Living crisis.

The UK average would see homeowners earn £498,687 if they downsize from a five-bed to a three-bed. Those who own their homes outright in London could earn the highest return, gaining almost £1.1million in cash by downsizing from an average five-bed of £1.7m, to a three-bed averaging at £635,149, according to data from Rightmove.

Tim Bannister, Rightmove property expert said: "Downsizing is a sensitive topic for many homeowners, as emotional ties and the inconvenience of moving often deter them from selling their family homes. However, empty nesters may overlook the significant benefits of downsizing, such as reduced energy bills and increased cash from purchasing a smaller home, that can still cover moving costs with leftover returns.

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"By transitioning from a five-bedroom to a three-bedroom house, homeowners could still retain spare bedrooms for guests and free up on average half a million in cash for other uses before moving costs." James Linder, Regional Sales Director at Leaders Romans Group, said: “We’ve observed a trend in downsizing among homeowners, particularly in towns with family homes and larger urban areas.

"Many people are downsizing to release equity, often using the substantial cash returns to help their children get onto the property ladder. Additionally, the potential savings on energy bills, council tax, and maintenance costs are considerable. Moving can save homeowners a significant amount annually in energy costs alone.

"Lower council tax and reduced upkeep expenses further enhance the appeal of downsizing." Those in the North East can earn the highest percentage return. They will get up to 65 per cent of the value of their five-bedroom house, making a return of £339,425 from a five-bed house worth on average £520,873.