With over-65s holding nearly £3 trillion in property wealth, advisers can tap into the growing demand for equity release advice
Over-65s in the UK collectively own £2.94 trillion in property wealth outright, which could be utilised to enhance retirement income and support the housing market, according to new data from equity release adviser Key Later Life Finance.
The figures reveal that over 10 million homeowners aged 65 and above have fully paid off their mortgages, potentially allowing them to leverage this untapped wealth.
The highest concentration of property wealth is in the South East, where homeowners in this age group hold over £582 billion in property assets. London follows closely behind, with over-65s owning more than £520 billion in property wealth.
Together, the South East and London account for around 37% of the total property wealth held by over-65s. However, significant levels of property wealth are also held by older homeowners across the rest of Great Britain.
Government data indicates that average annual retirement income is £20,120 for individuals and £29,170 for couples. Key Later Life Finance suggests that this income could be significantly boosted by accessing the equity tied up in homes.
This wealth could also help younger family members, particularly as first-time buyer deposits now average around £61,090. Unlocking property equity could provide financial assistance to children or grandchildren, easing their entry onto the housing ladder and potentially stimulating further activity in the property market.
With many older homeowners possessing substantial unencumbered property wealth, mortgage brokers have an opportunity to expand their services by offering equity release advice. As more retirees explore options like lifetime mortgages to boost their retirement income or provide financial gifts, brokers can play a key role in guiding clients through the process, ensuring they understand the potential benefits and risks.
“Over-65s have considerable wealth tied up in their homes and are literally sitting on money that could give them a more comfortable or fulfilling retirement,” said Will Hale (pictured), chief executive of Key Advice. “Alternatively, this wealth could be used to provide a living inheritance and offer family members cash at a point in their lives when they need it most, for example when children or grandchildren are looking to get on the housing ladder.
“Lifetime mortgages enable money to be drawn down tax free which can be a sensible way for over-65s to fund retirement needs or to make gifts in a tax efficient way. However, everyone’s circumstances are different, and it is important that these products, which do have some downside risks, are accompanied by specialist advice.”
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