Over half of over 65s in Wales have paid off their mortgage

In a recent report by the independent equity release specialists at Key, it was found that the total value of a property owned by over-65s peaked at £1.133 trillion at the start of 2020 and has fallen by more than £9 billion over the past quarter, with COVID undoubtedly playing a role.

Still, if you can look past the last few months, there are significant long-term gains to be seen. Older homeowners have seen an average growth of 45%, which is equivalent to £73,400 in just the last decade. One of the areas to have seen a surprising surge in value in the last year alone is Wales. The average equity value for homeowners aged 65 and over has gone up £2,125, with a combined change in value of plus £562.275 million.

Throughout the UK, the West Midlands Region is the only region where the average house value for over 65s has actually decreased, with the house value in that region down by £235 over the past year. London has seen the biggest average value increase of over £25,000. The average value of home equity increase for over 65s across the UK is £6,032.

Will Hale, CEO at Key said: “The property market has suffered along with the rest of the economy during the coronavirus crisis and effectively shut down for months. Coupled with the ongoing political and economic uncertainty of the past few years, it has gone through a turbulent time. However, property values seem to have remained relatively buoyant and with the current stamp duty exemption, we are likely to see continued interest from buyers.”

In such an uncertain time and with so many of us affected financially by the implications of the coronavirus pandemic, there has been a dip in the equity release market because the last thing people want to do in uncertain times is plan for their future. However, over half of the over 65s in Wales have paid off their mortgages with 264,600 over 65 households out of 419,380 in wales owning their house outright.

Across the UK there are over 4 million over-65 households that have paid of their mortgage, the North West tops the list having the most mortgages paid off with 671,000, followed closely by the South East (656,000) and South West (626,000).

Will Hale further commented: “Against this backdrop, we find millions of over-65s who have repaid their mortgages and are sitting on considerable unencumbered property wealth but may find that their retirement funds are not quite as healthy as they hoped.  It is vital to get specialist advice and consider all assets when it comes to planning your finances through retirement as making smart choices can significantly improve your standard of living throughout later life.”

Retirement planning doesn’t need to be stressful, however, as long as you have somebody in your corner who understands the market and knows exactly how to get the most out of your nest egg, whether that’s savings or the equity locked away in your home.

These are complex decisions and there’s no one right or wrong answer to them as the answer will always depend on your specific circumstances. So, if you want an idea of what your retirement income is going to look like or just want to talk to someone and look through your options, there are equity release and retirement planning specialists ready and waiting to take your call.