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Over-65s have gained £5.5bn of property wealth over past 12 months

Retired homeowners have gained £1,165 each on average in property wealth over the last year despite uncertainty in the property market, analysis from over-55s financial specialist Key shows.

New data from the independent equity release advisor reveals that in the 12 months to June, retired homeowners saw an increase of £5.445bn.

While total property wealth owned by over-65s who have paid off mortgages is valued at £1.096 trillion, this is actually down from the £1,118 trillion recorded in February 2019, according to Key’s Pensioner Property Equity Index.

Since 2010, retired homeowners have benefited from growth of 41% - a total of more than £316bn - earning them gains of £67,000 each in almost a decade. 

Will Hale, CEO at Key, commented: “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.”

The biggest winners over the past 12 months have been the over-65s in the West Midlands who are almost £7,500 better off than a year ago with retired homeowners in Wales (£6,560) and the North West (£6,297) also recording strong gains in the past 12 months.

Retired mortgage-free homeowners in London, however, have lost more than £1,000 a month in the past year while over-65s in the South East and East Anglia have also seen property wealth values drop. Scottish retired homeowners saw property wealth slip slightly.

London and the South East still account for 35% of all property wealth held by retired homeowners despite the recent falls.

Hale added: “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.”

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