Retired homeowners are seeing their property wealth increase by over £1,000 in the past year, despite on-going housing market uncertainty. This information comes from an analysis from UK independent equity release adviser Key.
The total property wealth owned by those over the age of 65 who have paid off their mortgages is valued at an impressive £1.096 trillion. However, this is a fall from the £1,118 trillion recorded earlier in the year (February 2019). A market slowdown is being felt across the board.
Looking at an annual basis, retired homeowners still saw an increase of £5.445 billion during the period of June 2018 to June 2019, according to the Key Pensioner Property Equity Index.
Will Hale, CEO at Key said: “The ongoing uncertainty in the property market and the economy as a whole is having an impact on house prices but overall retired homeowners have still gained an average of more than £1,000 from their houses in the past year.”
Across Great Britain, the average gain of those over 65 in the past year is equivalent to £1,160 per person, but the national average apparently does not tell the whole story, Key says…
The biggest winners are in the West Midlands, who are nearly £7,500 better off than a year ago. Those in Wales and the North West have also recorded strong gains in the past 12 months, at £6,560 and £6,297 respectively.
However, in London retirees have lost more than £1,000 a month in the past year, while those in the South East and East Anglia have also seen property wealth drop. Those in Scotland also saw a slight dip.
London and the South East still account for 34% of all property wealth held by retired homeowners, despite these recent falls.
Hale also said: “Some parts of the country have experienced even bigger gains with the West Midlands, North West and Wales continuing to perform strongly. The basic fact is that no matter what happens month to month to house prices millions of over-65s will continue to hold considerable property wealth, which can transform their standard of living in retirement and enable them to address a wide range of financial issues.
“Increasingly equity release customers are able to help their adult children or even grandchildren to pay for house deposits while also being able to sort out their own finances whether it is clearing debts or even paying off mortgages. Equity release is not right for everyone but it is clear that if your home is your largest asset you should take some time to assess what role property wealth can play in retirement planning. Speaking to a specialist adviser is key to making smart choices.”