Over-65s currently own property wealth of £2.944trn outright, which Key Later Life Finance has said “could be used to support their retirement planning and also give a boost to the property market”.
Data shows more than 10 million over-65s own their properties outright without a mortgage and can “potentially” put the wealth to work.
Over-65s in the South East of England own the most property wealth with more than £582bn invested in homes followed by over-65s in London holding more than £520.767bn in their homes.
More than two-fifths (37%) of the property wealth held by over-65s is “concentrated” in the South East and London.
According to government data the average pensioner incomes in retirement are currently £20,120 rising to £29,170 for couples and could be “substantially enhanced by making use of unencumbered equity sitting with these older homeowners”.
This property wealth can also be put to work supporting children and grandchildren, Key Later Life Finance has said. With average first-time buyer deposits to get on the property ladder standing at £61,090, this wealth would in turn give a “welcome boost to the property market”.
Key Advice CEO Will Hale said: “Over-65s have considerable wealth tied up in their homes and are literally sitting on money that could give them a more comfortable or fulfilling retirement. Alternatively, this wealth could be used to provide a living inheritance and offer family members cash at a point in their lives when they need it most, for example when children or grandchildren are looking to get on the housing ladder.
“Lifetime mortgages enable money to be drawn down tax free which can be a sensible way for over-65s to fund retirement needs or to make gifts in a tax efficient way. However, everyone’s circumstances are different and it is important that these products, which do have some downside risks, are accompanied by specialist advice.”