September 3, 2009
Over 65’s Own £650BN Secured Equity
New research has found that pensioners own £654bn of equity in their homes as house prices show signs of stabilising.
Prudential has found that homeowners in England and Wales aged 65 and over have retained £611bn of equity in their property and a further £43bn is held in Scotland, and It says the picture across the UK as a whole is one of stabilisation, with property equity for the over-65s falling by less than £43 since February – the lowest fall recorded by the firm since it began its research into property equity.
Keith Haggart, director of lifetime mortgages at Prudential says: “A good many pensioners will be cheered by the news that property values appear to be stabilising and in some parts of the country are even increasing. This could bode very well for people considering using their home as an asset to boost retirement income.
“Of course falling property prices have affected every homeowner but it’s important to remember that many homeowners now aged 65 and above bought their homes years ago and have benefited from longer term growth in the housing market. Many people in this age group have lived in their home for twenty years or more. The fall in house prices over the last couple of years appears to have slowed and, if house prices do rise in the future, the retired population could expect to see their wealth increase.”
This is great news for those homeowners who have been considering equity release. For many people, selling up and downsizing isn’t an especially attractive option, and they don’t want to face the emotional wrench of moving house. Equity release provides people with retirement funds particularly when other sources of income are under pressure.
SOURCE: Prudential, 25/08/09
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