Over 60s sitting on equity ‘goldmine’

Homeowners over 60 now have an average of £82,446 tied up in bricks and mortar, according to new data from Norwich Union, reports Mortgage Solutions (26/9/07).

However only one in ten know how much their homes are worth and just 6% would consider selling their property to raise capital. Those aged 60–69 (13%) were more in touch with the value of their properties than older respondents, with just 6% of over 80s aware of the value.

Dominic Fraser-Smith, group product manager at Norwich Union Post Retirement Products, commented: “It is upsetting to see that two-thirds of over-60s are just getting by on £10,000 or less per year while sitting on what is potentially a retirement goldmine that could dramatically improve their quality of life. Equity release offers consumers the opportunity to access the financial value of their property without incurring moving costs or leaving the home they love, so it can be a handy solution to a difficult problem.”

Price Boost For Equity Release

Huge increases in retired homeowners' property values, which have seen prices increase by over £151m a day, could see more people turning towards equity release, Prudential has suggested (reports Mortgage Solutions 17/9/07).

The provider recently launched its Pensioner Property Equity Index, a quarterly audit to monitor the value of retired property owners' homes, with research revealing that in total retired homeowners in England and Wales are worth £714m.

Ali Crossley, business director of retirement income at Prudential, commented: "We are seeing the emergence of a more holistic view of retirement savings. Equity release is definitely a consideration for many and, when homeowners see the value of their homes increasing by such phenomenal amounts, the appeal of securing an income in the form of a property pension is increasingly attractive."

However, Andrew Dixon, marketing and sales manager at home reversions provider Bridgewater, questioned Prudential's thinking, and said: "The vast majority of clients identify the need first, whether it is for emergency funds, or a lifestyle change, and then look for a way to fund it."