KeyRetirement.com has revealed that retired homeowners have seen their property wealth grow by £9.24 billion since the start of the year as house prices continue to climb earning the average pensioner more than £500 a month.
Pensioners who own their homes outright have earned an average of £2,096 tax-free each from their houses since the end of January taking their property wealth to a new record high.
However, over-65s in London have seen property price rises of nearly £21,000 – around 10 times the national average – while Scottish pensioners have suffered losses of more than £8,500.
The short-term swings do not tell the whole story however – in the six years since Key started monitoring the housing wealth of the over-65s total pensioner property wealth has increased by around 21%, or £161 billion, which is worth around £39,000 on average for every homeowner.
Its Pensioner Property Index shows over-65 homeowners now own property £926.41 billion outright highlighting the growing importance of investment in homes for retirement planning.
That is being reflected in the continuing expansion of the equity release market with customers releasing property wealth taking around £76,000 on average rising to more than £134,000 in London.
The index reveals major differences in the property market across the country with six regions – London, the South East, Wales, the South West, East Anglia and the East Midlands still seeing strong growth.
Dean Mirfin, technical director at KeyRetirement.com said: “Property wealth is a huge asset for pensioners and is making a massive contribution to standards of living in retirement reflecting the success of investing in a home.
“The different housing markets around the country show prices do vary but the long-term story is that property wealth is still growing as highlighted by our research which began in 2010.
“The contrast between the average £76,000 that can be generated from property wealth and the value of average pension savings underlines how vital it is to seek independent expert advice on how to use housing wealth.”
