Downsizing out of debt
The best way to become debt free in retirement
The latest research from over-50s property specialists, Regency Living, reveals that over-50s can release themselves from financial debt, and all of the physical and mental health issues that can bring, by choosing to downsize to a park home.
Financial debt is a common yet difficult burden to shoulder that can end up causing stress and anxiety all the way through to later life. And it’s not just our mental wellbeing that can suffer as a result of stress – studies have found that too much stress has the potential to reduce our life expectancy by almost three years. Further studies reveal that financial stress specifically has a negative impact on our biological health, and is even linked to a greater risk of death.
Despite these findings, Regency Living’s analysis of debt data* reveals that the average amount of household debt is steadily increasing over the last decade.
In 2015, the average debt for a household that doesn’t have a mortgage stood at £9,423. As of 2024 – the latest data available – this had increased to £17,174, marking a 10-year increase of 82.3%.
There has also been a steep debt increase among households with a mortgage. In 2015, their average household debt including a mortgage stood at £164,148. Last year, it was £211,040, a 10-year increase of 28.6%.
Homeowners are carrying this mortgage debt well into their later life, with a survey from LV showing a third of mortgage holders saying they don’t believe they’ll pay off their property debt before the age of 65.
Downsizing to get free of debt
However, despite carrying so much debt into their retirement, Regency Living has revealed that over-50s can rid themselves of the stress by selling their property and downsizing to a park home.
The average sale price of a home in the UK currently stands at £377,182 (April 2025, latest available). Meanwhile, the average park home costs £168,027.*
So, by making this move, downsizers are not only buying themselves a wonderful home in which to enjoy their retirement, but they’re also going to have an average of £209,155 left over from the sale of their bricks and mortar property.
This is enough to effectively pay-off the entirety of their debt, with the £209,155 in equity all but covering the average household debt with a mortgage of £211,040.
Sales & Marketing Director at Regency Living, Tim Simmons commented:
“Downsizing to a park home is an increasingly popular choice for retirees for many reasons, from the great lifestyle provided in some of the nation’s most in-demand locations, such as Cornwall and Dorset, through to the ready-made communities of similar-aged, like-minded people waiting for them when they arrive.
But the financial benefit of choosing to live in a park home is equally as influential on people’s choice to make the move.
For many, it provides the opportunity to rid themselves of financial debt, including their mortgage. Many silver downsizers are likely to have whittled down their mortgage considerably more than the average household which often leaves them with a greater retirement pot when downsizing.
For many more who have already paid off their mortgage and don’t have any personal debt, the equity release of downsizing to a park home is completely life changing.
What’s more, many park home providers offer part-exchange schemes, which makes the process of downsizing even easier, as they don’t have to contend with the laborious, time-consuming process of selling via the open market. They can also get a license to occupy which can make the process of downsizing even more stress free.”
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