The latest Pensioner Property Index produced by Key Equity Release has placed a value of £1.232 trillion on property wealth among the over-65s age group.
Analysing and isolating the crucial findings from the figures provided by Key, independent financial advice firm Kingsfleet Wealth reports that over-65s enjoyed an average increase in property wealth of over £561 per month, owing to a rise in property prices.
Meanwhile, long-term property gains have reached an average growth of 58 per cent since 2010, suggesting that over-65s have been privy to a combined increase in property values that is in excess of £452 billion over the last 11 years. Per household, this equates to £90,420.
However, income growth has not remained in correlation with the rise in property wealth, with over-65 seeing their incomes go up by just £12 over the previous 11 years, equating to £331 per week on average.
Under-75s have an average income of £370 per week when factoring in housing costs according to the analysis, compared to £302 per week for over-75s.
For those over-65s who have paid off their mortgages, total property wealth is valued at £1.232 trillion. The value is estimated to have increased by £8.436 billion in the last three months alone, and that swelling in property value equates to an average gain of £1,685 for each over-65 homeowner, or £561 per month.
Key CEO, Will Hale, commented: “Over the last three-months, the property market has been buoyant, spurred on by the extension of the Stamp Duty Holiday and the launch of government guarantees for over 95 per cent of LTV mortgages. That said, the market performance over the last 11 years has generally been positive and over-65s homeowners have seen their property wealth increase by an average of £90,420 over the period.
“This puts into stark contrast the increase in average weekly pension income which jumped just £12 between 2010 and 2020. The retirement ambitions and needs of today’s over-65s as well as inflation make this increase seem even smaller and highlights how important it is for people to consider all their assets at retirement.
“Sitting in a quarter of a million pound home unable to keep the heating on or meet other day-to-day living costs makes no sense. Today’s modern equity release products can help people access some of the value tied up in their properties to address these issues and then through flexible features enable them to manage their borrowing by choosing to make ad hoc capital repayments or to service the interest if they wish.”
