26th February 2016
Pensioner property wealth has soared to record £920 billion making each retired homeowner £1,000 a month.
Retired homeowners have seen their property wealth grow by £13.7 billion in the past three months, adding £1,000 a month to the value of retirees’ properties.
Research by Key Retirement shows pensioners who own their homes outright have earned an average of £3,106 tax-free each from their houses in the past three months, taking their property wealth to a new record high.
In the six years since Key Retirement started monitoring the housing wealth of the over-65s, in January 2010, total pensioner property wealth has increased around 20% – or £152 billion. This is worth £37,160 on average for every homeowner.
The continued growth in house prices highlights the importance of property wealthy when it comes to planning for retirement. Retirees accessing wealth in their home through equity release now take £72,000 on average.
Retirees with London properties were the biggest winners – gaining £15,061 in the past three months on average. While those in the South East are more than £4,537 better offer and those in East Anglia are £6,448 better off.
Dean Mirfin, technical director at Key Retirement, said: ‘Retired homeowners have huge assets in their homes which can make a massive contribution to their standard of living demonstrating how important property investment is.
‘For many the major barometer of their financial well-being is the value of their home. The increase in values experienced since our research began in 2010 show the impact that property values can have on pensioner capital and income in retirement.
‘The cash that can be generated from property easily outstrips the average amount held in private pensions highlighting how important it is for homeowners to seek independent expert advice on how to use their housing wealth.’