I need to downsize , but my equity is my home

Mrs_gillian

Are there any ways I can release money from my house to downsize ? We don't have enough savings to buy the next property. The money is the house .
We are both 64 and recently have had health scares ( not out the woods yet ) it's time to do it and enjoy a bit of what we have worked hard for 
TYIA

MFWannabe

Will you be selling your current property? If you are then the money for new property comes from the sale 

eddddy

It usually works like this... you sell your current house and buy the new house at the same time.

So...
- Your buyer pays for your house
- You use the money they've given you to buy your new (downsized) house


Both those things happen on the same day. So you move out of your current house in the morning, and move into your new house in the afternoon.

 

comeandgo

Usually people sell the house they are in and buy another with the proceeds.  Or you could sell then rent which gives you more time to look for new property.

user1977

"Downsizing" suggests you're selling the current house? In which case there isn't a problem.

Or do you mean you want to retain ownership of it but buy something smaller in addition?

ka7e

Your expenses like estate agent's and solicitor's fees are deducted from the proceeds of the sale of your current house. The balance, after you have paid the purchase price for your new house, will be in your bank account in a couple of days. I think the only costs I had in advance where for an EPC (under £100) and a deposit for the removals firm.

FreeBear

ka7e said: I think the only costs I had in advance where for an EPC (under £100) and a deposit for the removals firm.

Survey costs for the property you are buying ?

Unlikely a surveyor would want to wait until the current property sells. And if the sale falls through, there may well be another survey to pay for on the next property.

maisie_cat

It's common now to have to pay a "deposit" for legal services, we had to pay £500 each for selling and buying.
I would allow at least £2k for up front costs that won't wait until completion.

Flugelhorn

good point have to pay upfront for searches etc 

robatwork

If you sell example:
Sell for £300,000
Buy new place for £200,000
Costs of buying/selling/moving £15,000

You end up with £85,000 in your bank.

If you aren't selling but thinking about equity release that will need a different example altogether. 

pinkshoes

Mrs_gillian said:

Are there any ways I can release money from my house to downsize ? We don't have enough savings to buy the next property. The money is the house .
We are both 64 and recently have had health scares ( not out the woods yet ) it's time to do it and enjoy a bit of what we have worked hard for 
TYIA

I'm not quite sure what you are asking.

Are you saying the smaller property you want to downsize to is more expensive that the bigger property you are currently in? (e.g. moving to a more expensive area?).

If the smaller property is cheaper, then you just put yours on the market, then once someone wants to buy yours and you agree a price, you can then put an offer in on a cheaper property. Everyone completes on the same day, so the money someone pays for yours gets passed down to the house you're buying, and you can then keep (after selling/buying fees) anything left over.