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Pensioner property wealth tops £1 trillion

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Property wealth owned by the over-65s has topped £1trn, up £37bn in the past year.

That is equivalent to a gain of more than £7,900 each in property wealth over the past 12 months, according to analysis from Key Retirement.

Key Retirement’s pensioner property equity index shows that since 2010, retired homeowners have seen growth of 41% – £321bn. This equates to £68,500 for every homeowner over 65.

Retirees in the South East and East Anglia have benefited most, with gains of more than £1,000 a month. The only region to see an average fall in the value of home equity over the year was London, where homeowners saw a drop of £5,700. However, older Londoners still own the most property equity.

But this group still owns an estimated total property equity of £176bn – second only to the South East where this figure is £213bn.

The results are likely to increase controversy over ‘intergenerational fairness’. Over the past 40 years, retired households’ real disposable incomes have risen by an average of 2.8% per year, compared to just 2.1% for non-retired households. Pension income and wealth has also increased exponentially. The net household wealth of the over-50s is around 5x that of those in their thirties

Dean Mirfin, chief product officer at Key Retirement, said: “Total property wealth of more than £1trn means pensioners who have paid off mortgages can rely on using their homes to generate tax-free returns no matter what happens in the short and medium term.

“The average homeowner is releasing through equity release the equivalent of the gains made since 2010 and property wealth is having a dramatic effect on the standards of retirement living for many thousands across the UK.”

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