Property has overtaken the State, pensions and savings to become the most likely means of funding long-term residential care, according to research from Partnership.
The care annuity provider’s second Care Index compared attitudes towards the cost of long term care across the UK year on year.
In 2012, the highest percentage of people (52%) thought that the state would pay for some or all of their care followed by pension income (45%), savings (35%) and the sale of their home (31%). However, as care funding moves up the news agenda and consumer awareness grows, the largest proportion in 2013 now believe that they would sell their property (40%) to fund their long-term care and a further 9% would rent their property to give an on-going income.
Chris Horlick, managing director of care at Partnership, said: “Last year, we anticipated that property was likely to become a key source of funding for care. As the debate around the reform of social care funding in England has grown so too has the speed of change in attitude, as people’s belief in the State is replaced by reliance on their own means.
“It is believed that people over the age of 65 have £753 billion of un-mortgaged equity in their property. Accordingly property is an important source of value for people in retirement who are asset rich but income poor.”
He added: “This research also suggests that equity release may provide another valuable mechanism to enable people to access the equity in their property to cover their care fees.
“However, it is critical that the majority of people (57%) who are currently paying some or all of their care costs and may plan to use their property to fund their care fees get appropriate regulated financial advice.”