Pensioner property wealth hits new record high

Value of property owned by pensioners jumps £20 billion in three months.
The value of property owned by British pensioners has jumped by more than £20 billion over the past three months, reaching a total of nearly £828 billion. That’s according to the latest research from Key Retirement Solutions.
That breaks down to an average of £4,341 per homeowner, if they own their property outright, the equivalent of almost £1,500 a month.
As a result of the price increases, pensioner property wealth is now at a record high.
The biggest winners
The table below breaks down how each individual region performed between May and August, and the estimated value of property owned by people aged 65 and over in those regions as a result.
Region |
Average change in value for homeowners aged 65+ |
Estimated value of property owned outright by people 65+ |
London |
£23,118 |
£160.164 billion |
South East |
£6,920 |
£149.639 billion |
Scotland |
£5,688 |
£45.718 billion |
Wales |
£4,165 |
£31.074 billion |
East |
£2,840 |
£88.651 billion |
South West |
£1,814 |
£113.339 billion |
Yorkshire/Humber |
£1,706 |
£34.256 billion |
West Midlands |
£1,696 |
£48.465 billion |
East Midlands |
£1,646 |
£55.637 billion |
North West |
£863 |
£73.746 billion |
North East |
-£758 |
£27.102 billion |
Great Britain |
£4,341 |
£827.796 billion |
As you can see, the North East was the only region to see a fall over the last quarter. It’s also the region where property owned outright by pensioners is worth the least.
In contrast, London saw huge gains and remains the region where pensioner-owned property is worth the most.
According to Key this house price growth is helping boost the equity release market, with £641 million released in the first half of 2014. That works out at an average of £65,000 per homeowner.
For more on how equity release works, read The pros and cons of equity release.
Compare mortgages with lovemoney.com
What about younger homeowners?
It’s not just older homeowners that are enjoying house price growth though. The latest figures from the Land Registry reveal that annual house price growth hit 7.2% in July, rising 1.7% since June alone.
As a result the average house price in England and Wales now stands at £175,653, just £6,000 below its peak of £181,442 in November 2007.
Compare mortgages with lovemoney.com
More on property:
The pros and cons of equity release
Average price of flat jumps £50,000 in 10 years
What's my Standard Variable Rate?
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Comments
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The usual laissez faire attitude to debt continues, and this government are keeping prices at unrealistic bubble values. It will be interesting when the fiscal borrowing sources run out, capitalism kicks back in and interest rates are forced up. A lot of people are being set up and they will get burned. What an irresponsible country we have become.
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Like overtone I don't feel any better off with my suburban semi apparently increasing in value. house prices are high and perhaps going higher still because there are too few of them relative to those that want to buy. This was "O" level economics when I was at school but it seems to be beyond the collective wit of the current crop of party leaders. A policy to increase the supply of property over a period of 10 years is needed. It would be electoral suicide to cause prices to drop markedly, so we need to be realistic, but keeping them stable in cash terms so that they decrease in real terms should be the aim. And its a win win - greater house building increases peoples employment, and their general satisfaction, and in the main the value added is done in the UK. so more tax revenue. Although inheritance tax receipts will suffer!
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As you say, when property prices rise, it's not just pensioners who "enjoy" price growth. But those wishing to buy a home for the first time may not find it so enjoyable, and maybe not those wishing to trade up, who find the gap between their home and something bigger has widened. Meanwhile, as a pensioner, I haven't actually been feeling £4341 better off over the last three months. Undoubtedly there will be some people wishing to "release equity" who will be glad to be able to borrow a bit more as a result of this increase. But it won't have a direct effect on most of us.
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03 October 2014