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Only 20% want to downsize as they are ‘attached’ to homes

Voice Of EU



Only a fifth of people say they plan to downsize in their retirement, with the top reason being that they are simply ‘too attached’ to their home. 

Those nearing retirement age are even less likely to have downsizing plans, according to research by investment platform Hargreaves Lansdown. 

Among those aged 45 to 54, just 17 per cent said they would move to a smaller home, while this fell further to 14 per cent among 55 to 64-year-olds.

Those nearing retirement age can downsize to a smaller property to access cash tied up in their home - but a survey had found that only 20 per cent want to do so

Those nearing retirement age can downsize to a smaller property to access cash tied up in their home – but a survey had found that only 20 per cent want to do so

This is despite house prices increasing rapidly in the past year, with larger homes benefitting most, meaning downsizers could have more money to buy a smaller property.

However, those moving from larger homes in the countryside or on the edge of towns may find the difference eroded by higher prices closer to town centres.

While 20 per cent said they would downsize, another 38 per cent said they would not and 42 per cent were unsure, according to the survey of 2,000 people.

People often buy a less expensive property in retirement and use the money from the sale of their old home in order to top up their pension income, help out their family financially or simply enjoy their retirement.

Those in the best position to downsize are people who have paid off their mortgage, or a large chunk of it, as they can use the money from the sale to buy their next home mortgage-free.

However, more people are now struggling to pay off their home before they retire – and it can also be difficult to remortgage once you have reached a certain age. 

Financial worries also weigh on people’s decisions not to downsize, according to the Hargreaves Lansdown survey.

Around one in ten  didn’t believe they would make enough money from downsizing, while almost a quarter said it would be too expensive.

‘The financial reality may not be as positive as the fantasy, with the costs of moving taking a chunk out of their proceeds and leaving them with far less than they hoped for,’ said Helen Morrissey, senior pensions and retirement analyst at Hargreaves Lansdown.

Almost a quarter of respondents said the costs of downsizing would be too expensive

Almost a quarter of respondents said the costs of downsizing would be too expensive

However, the most-cited reason why the respondents didn’t want to live somewhere smaller was that they were too attached to their home, which 28 per cent claimed.

Morrissey added: ‘When you’ve won the race for space, it’s very difficult to give up.

‘Massive house price growth makes the prospect of downsizing in retirement tempting but on closer inspection it is clear not many people are convinced.

‘The pandemic has reminded people how valuable it is to have room to roam at home, and the prospect of giving that up at a time when they may be spending more time at home isn’t appealing.’

Geographically, Londoners were the most likely to want to downsize with 39 per cent having plans to do so in their retirement. This compared to 16 per cent of residents in the South-East.

Homeowners in the capital stand to make significant gains when they sell, especially if they have been in their property for a long time, as prices have increased rapidly.

Those with mortgages outstanding on London homes may also struggle to service a big loan on their retirement income. 

What are the options if you don’t want to downsize?

Downsizing in retirement is becoming a necessity, rather than a choice, for many as the cost of living increases and workplace pension plans become less generous.

There are other ways to help fund your retirement, including working for longer or cutting down on other outgoings.

Another option is to release equity from your home, using a lifetime mortgage.

This is when a homeowner takes out a loan from a specialist equity release provider for part of the value of their home.

They can stay in their property and are still the owner, and the loan is then repaid through the sale of the home when they die or go into long-term care.

Downsizing can release extra funds for retirement but often homeowners find that high prices for suitable properties can mean they don't get as much as they think

Downsizing can release extra funds for retirement but often homeowners find that high prices for suitable properties can mean they don’t get as much as they think

However, equity release should be approached cautiously as there are interest charges and other fees involved, and it can make it more difficult to move home again if you need to.

It also reduces the inheritance that an older person may want to leave for their family.

Morrissey adds: ‘This comes at a real cost, not just because of the fees involved, but also because in most cases interest on the loan will roll up, and the amount you owe can easily double before you repay it.

‘Equity release can also stop you from downsizing later if you change your mind, if the debt has eaten so far into the equity in your home that you can’t afford a smaller place.

Another option is to take out a Retirement Interest-only mortgage (Rio).

Here, the homeowner remortgages their property with a mainstream lender, but they do not need to pay any more off the balance of their home – they only need to pay the interest on the loan.

This can reduce the monthly outgoings, and again the loan only needs to be repaid when the homeowner dies or goes into care.

Unlike with equity release, however, the borrower will need to have enough income to pass a bank’s affordability assessments.

It is also possible to continue with mainstream mortgages, if the borrower is under lenders’ minimum age thresholds and has the income to do so.

They could then cut their monthly payments by extending their mortgage term, or release some equity by remortgaging to a higher loan-to-value product.

Morrissey added: ‘The right answer is different for everyone, but it’s important to consider it all carefully before you rule out downsizing.’

Equity release: How it works and where to get advice

This is Money has partnered with Age Partnership, a firm of independent advisers who specialise in finding retirement mortgages and equity release that works for you. 

>> Find about equity release and get advice   

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‘I was so proud to be Navajo and so proud to be Irish’

Voice Of EU



“For the first time in my lifetime my two cultures were intertwined in the most beautiful way … I was so proud to be Navajo and so proud to be Irish.”

Doreen McPaul was speaking as she received a Presidential Distinguished Service Award for the Irish Abroad for 2021. President Higgins granted the awards to 11 people at a ceremony in Áras an Uachtaráin on December 2nd.

McPaul, of Irish and Navajo heritage, is attorney general for the Navajo Nation. Her award, under the category of charitable works, is in recognition of her fundraising for the Navajo, who experienced extreme hardship during the Covid-19 pandemic.

Her efforts led to a collaboration with the Irish Cultural Centre and McClelland Library in Phoenix, Arizona, which gathered more than $30,000 worth of donated supplies to assist the Navajo Nation at the peak of the pandemic.

“The Navajo Nation was so devastated by Covid-19, as a culture and as a community. [It] was really tragic and stressful, and we worked literally non-stop. The highlight of this was talking to people from all over the world …. Specifically with Ireland, we had this huge outpouring of support, and that was really overwhelming because of my own dual heritage and growing up as a half-Navajo half-Irish girl,” she told The Irish Times.

“As soon as people learned that the Navajo Nation attorney general was part-Irish, people reached out to me and claimed me as their own and invited me to all these things and celebrated my dual heritage in a way I’ve never experienced before. Literally they put me on the highest pedestal and that’s what this award signifies to me.”

A graduate of Princeton University, Doreen McPaul has worked as a tribal attorney for 20 years and has spent two years serving as attorney general. “I didn’t know I was nominated for the award first of all. So when the Irish council called to let me know I would be receiving a notice of the award, I literally cried.”

In all, 11 people received awards on Thursday, in a variety of fields. They were: Arts, Culture and Sport: Susan Feldman (USA), Roy Foster (Britain) and Br Colm O’Connell (Kenya). Business and Education: Sr Orla Treacy (South Sudan). Charitable Works: Doreen Nanibaa McPaul (USA), Phyllis Morgan-Fann and Jim O’Hara (Britain). Irish Community Support: Adrian Flannelly and Billy Lawless (USA). Peace, Reconciliation & Development: Bridget Brownlow (Canada). Science, Technology & Innovation: Susan Hopkins (Britain).

Colm Brophy, Minister of State for Overseas Development Aid and Diaspora said: “As Minister of State for the Diaspora I am aware of the profound impact our global family has had around the world in a variety of fields. There were 107 nominations for these awards this year, and the level and breadth of the achievements of the people nominated are, by any measure, remarkable.

The contribution of the Irish abroad has been immense, and the diversity of their achievements in their many walks of life, can be seen in this year’s 11 awardees.”

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Ski home values rise by up to 17% despite travel restrictions says Savills

Voice Of EU



It’s not just Britain’s property market that is red-hot. Homes in ski resorts are being snapped up by wealthy buyers despite the pandemic and on/off travel restrictions, a new reports suggests.

And just like here, the staggering growth in values stems from high demand and lack of supply. 

The findings are in Savills latest ski report, which tracks 44 resorts globally. It found that property prices grew on average 5.1 per cent in the last year.

However, some resorts – including Flims and Grimentz in Switzerland – saw values rise 17 per cent.

This chalet in Chemin Des Cleves in Switzerland and is for sale for CHF6,000,000, the equivalent of £4.9million

This chalet in Chemin Des Cleves in Switzerland and is for sale for CHF6,000,000, the equivalent of £4.9million

Top 20 prime ski resorts, based on price per square metres (priced in euros)

Top 20 prime ski resorts, based on price per square metres (priced in euros)

The release of pent-up demand for ski properties follows almost two seasons of closures for most resorts.

Jeremy Rollason, of Savills, said: ‘Only a few resorts such as Val d’Isère, Verbier and Morzine were seeing real price growth up until 2019. 

‘That has all changed with virtually all resorts in the Alps and North America experiencing strong double digit and sometimes exponential price growth in a matter of months.’

He adds: ‘The first quarter of 2021 was particularly acute for demand. Transaction volumes doubled over the previous year and fierce competition emerged, especially for prime property in the most exclusive resorts.

‘Property that had previously been for sale for a few months – or even years – suddenly found buyers who were keen to escape the confines of towns and cities.’

The North American ski resorts of Aspen and Vail top the Savills Ski Prime Price League with Courchevel 1850 moving from the top spot to third place.

Aspen, which celebrates its 75th birthday this season, is predominantly a domestic market, with average values at around £25,000 per square metre.

Meribel has broken into the top ten price resorts with asking prices of around £13,800 per square metre. 

With its 200 lifts, and central to the world’s largest ski area – Les Trois Vallees – Meribel is popular among French and British skiers looking for a dual season resort.

Making the most of a dual season: This five-bed chalet is in St Gervais, in France's Haute-Savoie region, and is on the market for €2.5m (£2.13m)

Making the most of a dual season: This five-bed chalet is in St Gervais, in France’s Haute-Savoie region, and is on the market for €2.5m (£2.13m)

Estate agents Savills also looked at the prospects for price growth in 10 key resorts

Estate agents Savills also looked at the prospects for price growth in 10 key resorts

While resorts have always pushed the benefits of using properties throughout the winter and summer, a dual season resort is now the most important locational factor for buyers as they look to make the most of their holiday homes, according to Savills.

The estate agent said that regardless of international travel restrictions, foreign buyers are still keen to purchase ski resort properties and have been quick to return to the property market as restrictions have lifted.

This week, some resorts opened early amid heavy snowfall and are hoping to remain so throughout the season.

Mark Nathan, of Chalets 1066, the largest operator in France’s Les Gets, said: ‘We are fortunate here in that Jean-Baptiste Lemoyne, the French Minister for Tourisme has said that ‘closing is not an option’ this winter.

‘The snow is amazing at the moment and the pistes will be opening this weekend. The planned date was December 12 for early opening so this shows how good the conditions are. The fresh snow was up to my knees this morning.’

This five-bed chalet is in Saas-Fee, Switzerland, and is for sale for CHF4,200,000, the equivalent of £3.4million

This five-bed chalet is in Saas-Fee, Switzerland, and is for sale for CHF4,200,000, the equivalent of £3.4million

He explained that visitors will be expected to show proof of vaccination to go into bars and restaurants, and also when buying lift passes.

‘There might even be random checks in the lift queues. We are also expecting to have to use masks in lift queues – but these are all small points and the good news is we can all ski and enjoy a mountain holiday. 

‘Our bookings are the best we have ever had by a long way, in over 13 years of business. 

‘Over the past few days there has been nervousness among the English and a few other countries with the new Omicron variant, but we now hear that the Swiss will be allowing people who are on their way to France to land at Geneva and then take a transfer directly to France. 

‘Overall, we are looking forward to an exciting ski season.’

Qualified ski instructor and ski journalist Rob Stewart added: ‘British skiers spend more money than domestic visitors and ski resorts are desperate to have us back. 

‘In some French resorts, British skiers are only second to French visitors in regards to numbers and we are such an important part of their economy.

‘This winter, snow seems to have come fairly early and in decent quantities, and it’s cold. This always helps increase visitor numbers and after such a terrible winter last year because of Covid, there is huge positively about this winter being a good one.

‘The challenges remain for British skiers, with nerves around changing travel restrictions still haunting the industry and lack of availability pushing prices higher for the moment. 

‘But for skiers that have missed out for one and half seasons now, these challenges will be overcome if possible, for the chance to get back on the slopes’.

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Players should be allowed to compete in Saudi International

Voice Of EU



Rory McIlroy has delivered a potentially crucial intervention on behalf of golfers wishing to compete in the Saudi International in February by insisting the PGA and European tours should not block them from playing.

The Saudi International, once of the European Tour but now an Asian Tour event, has confirmed a number of the world’s most prominent golfers – including Tommy Fleetwood, Bryson DeChambeau, Dustin Johnson, Phil Mickelson, Ian Poulter, Lee Westwood and Sergio García – have agreed to feature in 2022.

Saudi Arabia has sought to make inroads into professional golf but has encountered stiff resistance from the European and PGA tours. It has been reported both those bodies could trigger open warfare by refusing to grant releases to their members to play in Jeddah. The European Tour will discuss the issue at board level in the coming days.

McIlroy has no interest in accepting Saudi money but believes others should not be denied the opportunity. “I think we’re independent contractors and we should be able to play where we want to play,” he said. “So in my opinion I think the Tour should grant releases. It’s an Asian Tour event, it’s an event that has official golf world rankings.

“I do see reasons why they wouldn’t grant releases but I think if they’re trying to do what’s best for their members and their members are going to a place other than the PGA Tour and being able to earn that money, I mean, we’re independent contractors and I feel like we should be able to do that if that’s what our personal choice is. My personal choice is not to do that but obviously a lot of players are doing that and I think it’s fair to let them do that.

“My view as a professional golfer is I’m an independent contractor, I should be able to go play where I want if I have the credentials and I have the eligibility to do so. I’d say most of the players on tour would be in a similar opinion to me.”

The matter is further complicated by some players having signed multi-year deals to play in Saudi. McIlroy, 32, did admit the prospect of legal wrangling is an unappealing one. “I think the professional game needs to get to a point where we as professionals need to know where we stand,” he said. “Are we actually independent contractors? Are we employed by a certain entity? There’s a lot of grey area in that and that’s what sort of needs to be sorted out, I think.”

McIlroy’s curious competitive year will close at this weekend’s Hero World Challenge in the Bahamas. “I think it’s been a year where I’ve struggled in parts but I still got two wins on tour, which is pretty good,” the world No 8 said. “I was tied for the lead with nine holes to go in the US Open. I played well in parts, I just didn’t do it consistently enough. I go back to 2019 and had like 19 top-10 finishes or whatever it was; that’s the level I want to play at.” – Guardian

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