Retired homeowners have seen their property wealth increase by more than £3,150 in the past year despite the impact of political and economic uncertainty on the housing market, new analysis from Key has revealed.

Key’s Pensioner Property Equity Index showed the total property wealth owned by over-65s who have paid off mortgages is valued at £1.133trn and has increased by £14.78bn in the past year – which equates to an average gain of £3,152 for retired homeowners.

The equity release adviser’s data also showed the total value of pensioner property fell to £1.096trn in the early part of last year, before recovering in the autumn to £1.132trn. Key added that gains since the autumn had been modest, but that retired homeowners had still seen strong year-on-year increases.

Since Key started analysing the mortgage-free property wealth of the over-65s in 2010, retired homeowners have benefited from growth of 45% – a total of nearly £354bn – to earn them gains of £75,000 in the past 10 years.

“Political and economic uncertainty hit the housing market last year, but there were genuine signs of recovery towards the end of the year and retired homeowners who no longer have mortgages were big beneficiaries,” Key CEO, Will Hale, commented.

“While it is useful to be aware of market fluctuations, what happens on a monthly basis is unlikely to alter the simple fact that millions of over-65s retain considerable property wealth which can transform their standard of living in retirement, and enable them to address a wide range of financial issues.”

Key’s data revealed the biggest winners in the past year were over-65s in Wales, who had seen gains of £11,700, while retired homeowners in the West Midlands (£8,165), East Midlands (£5,799) and the North-West (£4,355) also saw gains above the average.

The only region to suffer substantial falls was East Anglia, where retired homeowners were £3,267 worse off over the year. Homeowners in the South-East also saw marginal price falls of £149 over the year.

Key added that the South-East still accounts for nearly a fifth (18.9%) of all property wealth held by retired homeowners – despite the slight drop – while East Anglia is the fourth-wealthiest region in terms of mortgage-free property held by over-65s.

Hale continued: “Increasingly, we are seeing people choosing to access property wealth in retirement and using modern lending features to suit their individual circumstances. Choosing to use drawdown rather than lump sum and to repay the interest rather than letting it roll up make these products even more flexible and attractive than before.”

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