A NEW generation of older Scots who are looking to supplement their pensions by selling their homes and downsizing are helping fuel a boom in homes sold using straight cash.
New figures show that the proportion of house sales in Scotland that did not require any borrowed money has shot up by almost 17 per cent over the past ten years.
Experts say that the surge is to a large extent helped by older last-time buyers looking to support their retirement by downsizing to more practical, compact and more attractive properties.
In 2014/15 some 33,227 homes were money purchases - a rise of 5,682, or 16.5 per cent, since 2005/06, according to the Registers of Scotland (RoS).
The top three hotspots for the cash sales are in some of the country's most beautiful locations.
Sutherland tops the list with some 60 percent of house sales now being cash purchases. Some 59.4 percent of Kirkcudbright and Wigtown home purchases are now money buys and in Argyll and Bute the figure is 57.3 percent.
In Glasgow the proportion of house sales paid for by cash has risen by 75 percent over the ten years from 2257 to 3940 and now accounts for over one in three home purchases. Other areas of Scotland where the 10-year rise has marked includes Berwick, East Lothian, Peebles, Selkirk and Roxburgh (72 percent), Dumbarton (68 percent), Stirling (70 percent), and Midlothian (63 percent).
Jeff Bromage from Saga Personal Finance commented: "Our research shows that people are changing their view about how they fund their retirement and indeed care in later life and are now more likely to consider their house as part of their retirement funding.
"Many people choose to move to smaller or more manageable properties and they use the money this releases for a variety of reasons including giving to younger family members to help get them on the property ladder or to fund their education."
Saga analysis shows that three in four over-50s in Scotland say they are considering changing home to find a property more suitable for their retirement.
"This compares to 69 percent nationally so that shows they are planning ahead rather than waiting until it becomes a crisis decision," said Mr Bromage.
Faisal Choudhry, head of research at estate agents Savills in Scotland said the older downsizers appear to be a more attractive proposition for those who are interested in securing a no-hassle house sale.
"The key word in all of this is equity, "he said. "Scottish house values particularly in prime residential hubs of Edinburgh, West End of Glasgow and Aberdeen, have risen substantially in the past decade.
"Downsizers especially have benefitted from this, by selling, freeing up cash and in many cases buying a smaller home, and becoming mortgage free." He added they are usually home owners who have been in the housing market for a long time, and are perhaps thinking about retirement and releasing equity.
Mr Choudhry added: "Where there is competition for a property, those with cash are at an advantage as they don't need to wait for mortgage approval and sellers may see them as a more reliable option.
"Some lucky first time buyers have been the recipients of financial assistance from the Bank of Mum and Dad who have used some of this equity to help their children on to the first run of the property ladder."
Dr John Boyle, director of research and strategy at Rettie and Co estate agents predicted that the levels of elderly downsizers will continue to grow as the population gets older and suggested incentives to continue the trend including tax breaks. He called for the abolition for downsizers of the Land and Buildings Transaction Tax, introduced in April in Scotland to replace UK stamp duty.
He said: "It would be in the Government's interest to make it grow faster - as well as giving older people a greater range of choice, it will free up family housing for those who really need it.
"Downsizers tend to want more exclusive, larger properties in relatively quiet areas but still accessible for amenities and facilities.
"Many first time buyers probably want more of a vibrancy in an area and tend to target smaller flats that are more affordable. "
A group of MPs last year suggested that helping older people to move from and downsize their home would actually free up family-sized homes for younger families - providing be a win-win for older and younger generations.
The cross-party parliamentarians suggested a "help to move" package of measures to support and encourage older people to downsize. This would include financial measures such as stamp duty exemption, later life mortgages and shared ownership, together with access to specialist financial advice.
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