It is the paradox of housing wealth; you might be richer on paper, but you can rarely spend it. UK pensioners are getting richer; at least when measured in terms of housing wealth. However, many pensioners live in comparative poverty.
For those of us depending on house values to fund our retirement, think it through. If a significant number of others are doing the same, property values are likely to sink when everyone tries to sell their homes to capture all that equity.
Pensioner property rises in value by £41.5 billion in Q1 2007
Homewise Pensioner Property Equity Index has revealed the value of pensioner property has risen by £41.5 billion over Q1 2007. The Index showed that equates to a collective increase of around £461.49 million every day...
According to the retirement finance and property specialist, the nation's 6.3 million retired homeowners have each gained on average around £6,553 in property wealth since January. Over the past 12 months a pensioner can expect to have gained on average around £20,017 in the value of their home and the total collective worth of British pensioners' homes now stands at some £1.252 trillion.
Homewise says retired homeowners continue to see increases in the value of their property. However, the average annual disposable income of a single pensioner remains perilously low and the Government was recently called on to treat the plight of pensioners with the same urgency as combating child poverty.
Homewise warns that many 'equity rich' retired homeowners may actually feel less well off as the cost of living in this country continues to rise. The company recently launched Find & Afford, a unique scheme that enables over 65s to potentially use some of the capital tied up in their home to move to a location of their choice at a fraction of the cost - all without having to contend with much of the stress involved in moving.