Trading down from a detached home to a bungalow could produce an average windfall of just over £97,000 across the UK, a 41% increase on the £68,814 average sum which could have gained in 2002, researchers found.
Londoners could receive the highest average sum by trading down, at around £269,415, while people in Yorkshire and Humberside have seen the biggest 10-year percentage increase in their average windfalls out of the regions, with an 84% rise.
Someone downsizing from a detached home to a semi-detached property across the UK could gain just over £120,000 on average, a 46% increase on the £82,412 typical windfall in 2002.
Stephen Noakes, mortgage director for Lloyds TSB, has said homeowners who downsize their properties play a "key role" in the housing market.
A study has found that money worries strongly influences homeowners plans to downsize, with 33% of potential downsizers saying they need to move to reduce their household bills and 37% saying they would like to free up some equity.
Three in 10 of those planning to trade down said they were doing so to boost their retirement income.
Households have been squeezed by high living costs at a time when they are seeing low wage increases and struggling to make real returns on their savings amid low interest rates.
A third of home owners who plan to downsize in the near future are doing so in order to cut their household bills, a study has found.
Just over half (51%) of home owners surveyed who are planning to move house in the next three years said they plan to downsize, compared with just over a fifth (22%) who are looking to trade up to somewhere bigger, Lloyds TSB found.
But "empty nesters" who no longer need the space are not the only ones looking to trade down, and while 63% of those looking to do so are aged over 55, more than a quarter are aged between 46 and 55 and around 5% are aged between 36 and 45, the study found.