The company believes that as the equity release market develops, more and more retired people will look to move abroad. Indeed, Economic Lifestyle’s research revealed around 328,000 retired people would look to release over £30,000 of equity from their homes if they were to live abroad.
Mark Neal, managing director of economic lifestyle said: “The development of the equity release market, which saw retired homeowners release £1.1 billion from their homes during 2005, will fuel the number of retired homeowners buying properties abroad.
“Indeed, our research shows that 16% of people aged 65 and over would consider moving abroad if they could also retain a property in the UK. The growing number and range of equity release products is making this easier to do and it will be a contributing factor behind the estimated 1.88 million Britons aged 55 and over who could be living abroad within four years.”
The average value of British-owned property in Spain and France is around £109,500, although experts predict that prices are rising. A recent survey2 suggests that an elderly couple with a £500,000 house could raise as much as £220,000 through an equity release scheme – sufficient to purchase a property abroad whilst retaining the right to live in their UK home for as long as they want.
Economic Lifestyle warns retired people thinking about living abroad to consider all the implications. These include:
Financial
- Even if you pay with cash from equity released in the UK, consider taking out a small mortgage as this will mean that a survey is conducted on the property
-Open a local bank account as most utility bills have to be paid by Direct Debit
- Consider maintaining a property ‘bolthole’ in the UK
- Ensure that your state pension can be paid into a local bank account
Social
- Consider the implications for relationships with family and friends
Legal and insurance
- Ensure that a proper legal title exists on the property
- Take out adequate buildings and contents insurance cover.
