Around 21m people over 50 in the UK are worse off as the government tries to stimulate the economy with Quantitative Easing (QE) and historically low interest rates, according to a report released this month from the Centre for Economics and Business Research (CEBR) for Saga.
The report says that pensioners and those nearing retirement have been hit the hardest, with people in their 50s and early 60s seeing their real income – taking into account inflation – fall by 9% in the past four years, and those aged 65 to 74 seeing an 11% drop as a result of rising prices, low interest rates and QE.
Rising Demand for Retirement Rentals
This fall in real income is leading a growing number of older people to sell their homes to release capital and move into rented accommodation. Girlings Retirement Rentals, the UK’s leading provider of retirement rentals on assured tenancies has seen a 32% rise in enquiries in recent years, as many elderly people are finding they need the capital to fund their retirement.
Peter Girling, Chairman of Girlings Retirement Rentals says, “Many elderly people are releasing the capital in their homes to fund themselves through retirement and are moving into rented accommodation. The economic situation, together with pensions not meeting the expected targets is driving this, but also many people want to downsize and don’t want the burden of homeownership.”
Enhancing Security in the Private Rental Market
“Renting is the ultimate in equity release as people can invest capital from a house sale to fund retirement and at a time when real income and pensions are down this is becoming an increasingly attractive option. However, retired renters want security of tenure in later life; they don’t want to have to move at the whim of a landlord this is why our assured tenancy is so popular, as the choice to leave a property lies with the tenant and not the landlord. Currently, the private rental market offers very little security of tenure and this must change, to accommodate the needs of older renters and to attract others.”
Article courtesy of Property Investor Today
