Homeowners in England and Wales could almost double the amount of money they have on hand for retirement by using their property wealth, research by Legal & General (L&G) has found.

Analysis of Office for National Statistics (ONS) data by L&G Retail showed that in the last five years, house prices have increased by 20% to an average of £290,000.

The firm stated that for older homeowners, property wealth could help to boost the amount of money available to fund their retirement.

The average pension pot at the point of retirement for L&G drawdown customers is £72,000, but if they were to access their property wealth using equity release, they would receive an average of £69,000 (24%), creating an overall retirement fund of £141,600.

The financial services firm said that this "could improve the prospects of many pensioners by adding an equivalent of five additional years’ worth of retirement income".

Although homeowners in London and the South East continue to have some of the highest value properties in the country, house prices house plateaued in these areas in recent areas.

However, house prices have increased by up to 49% in places such as Blaenau Gwent, Merthyr Tydfil (46%), Broxtowe (39%) and Salford (38%).

Managing director at L&G Retail Retirement, Lorna Shah, said: "Many retirees are not able to maintain the lifestyle they want with their existing pension pots alone. This will only become a greater challenge as people live longer and have to meet increased costs, such as those associated with residential care.

"Property wealth, using products like equity release, could increasingly be integrated into retirement planning in the future, as a larger number of homeowners turn to the value held in their bricks and mortar to bolster their retirement funds.

"If more people look to property wealth to fund their retirement, this could have interesting regional implications, as local house price fluctuations impact how much homeowners have at their disposal. Some areas of the country might end up taking a greater proportion of their retirement funds from their homes as a result."

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