Research by Equity Release Council has revealed that homeowners in the UK would consider using their property as part of their retirement plan.
Currently some pensioners are able to rely on work pensions and investments to help them through retirement but over the next couple of years more consumers will rely on their property to pay for their retirement.
Equity Release Council found that 73% of people aged between 18-64 would consider using housing equity as part of their finances in later life. 45% of retirees would consider downsizing their property, 10% would rent out their spare room and only 7% would look into equity release which allows homeowners to free up some of the value that is tied into their property.
Consumers taking part in the research were also asked what they thought would be a top source of finance for them when they retired. 61% thought their property, 44% said employer pension, 39% said private pension and 36% said savings or investment.
17% of consumers who also have a second property such as a buy-to-let investment or a holiday property said they would consider renting out the property for extra income and 7% would sell the property if needed.
Nigel Waterson Chairman of The Equity Release Council commented on the research: “This research clearly shows that more and more people are considering using their property as part of their retirement finances. This might mean choosing to downsize, rent a room out or use equity release – or any combination of the above.
“With such a heavy potential reliance on the equity tied up in UK residential property, it is vital that consumers receive accurate information and access to specialist advice and products which have excellent safeguards.”
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By Amanda Bainbridge