Retired homeowners living without the burden of a mortgage saw their homes increase by nearly £1,000 a month over the past six months amid housing market uncertainty, according to analysis from independent equity release adviser Key.
Total property wealth owned by over-65s who are mortgage free is at a new record high of £1.118trn with the average homeowners seeing the value of their homes grow by £28bn, Key’s Pensioner Property Equity Index revealed.
Across the UK, average gains for retired homeowners in property wealth are worth £5,998 each, with all areas of the country benefitting in the past six months. However, those homeowners in Yorkshire and Humberside have seen the biggest increases, gaining £8,607. Following behind was Wales where retired homeowners earned £7,875 and the North West (£7,546).
While London property prices remain the highest in the UK, mortgage free homeowners in the capital have the least to celebrate, with their properties increasing by £1,655 in the past six months, only just surpassing what those in Yorkshire and Humberside achieved in a month (£1,435).
The equity release adviser noted that it’s index highlighted the long-term investment success of home ownership and the value of housing wealth for retirement planning.
Commenting on the figures, Key CEO Will Hale said: “The numbers are fascinating but the basic fact is that, no matter what happens year to year to house prices, many over-65s will have considerable property wealth which can transform their standard of living in retirement and help family members.
“Increasingly equity release customers are able to make substantial gifts to family members including their adult children or even grandchildren with money being used to clear debts, fund university fees and pay for house deposits and weddings. Customers can also use the money to ‘age-proof’ their own homes and preserve wealth for the family.”
Since Key started analysing the un-mortgaged property wealth of over-65s in 2010, retired homeowners have seen growth of nearly £34bn in property wealth – equivalent to an increase of 43 per cent.
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