The Intermediary – December 2025 - Flipbook - Page 56
L AT E R L I F E L E N D I N G
Opinion
Unlocking a more com
hose of us in the later
life lending market
have long made the case
that lifetime mortgages
can change lives for the
beer. That argument
has been strengthened by a new study
from the Equity Release Council and
Fairer Finance, which concluded
that accessing property wealth can
add years of comfort for pensioner
homeowners.
The research broke down average
pension incomes across the country,
and how it compares with the income
level required for a moderate level of
comfort in retirement, according to
Pensions UK.
What’s clear is that, irrespective
of where the homeowner is based,
unlocking existing housing wealth can
be transformative to the quality of life
enjoyed by homeowners as they age.
T
Regional variances
One particularly eye-opening aspect of
the research is the regional differences
involved, with areas where retirement
incomes are lowest well-placed to
benefit from lifetime mortgages.
For example, in the North East,
average pension incomes for a single
person, aer housing costs are
deducted, come to around £16,380
per year. That’s the lowest of any
region in the study, and so is the
furthest away from the £31,700 annual
income needed for a moderate level of
comfort in retirement, according to
Pensions UK.
Compare that with the South East,
where pension incomes are typically
around £19,240 per year.
Yet unlocking property wealth
can have an enormous impact on
those pension incomes, providing
homeowners with a far higher
standard of living in retirement.
In the North East, a 40% equity
stake is typically worth around
£65,600, enough to top up current
pension incomes to the moderate
level for more than four years.
It’s a similar story in regions like
54
The Intermediary | December 2025
Scotland, Yorkshire & Humberside
and the North West, with the research
demonstrating that tapping into
property wealth could boost pension
incomes for up to six years.
The impact in areas with higher
house prices is even more significant.
In the South East, unlocking 40%
equity from the typical property
would top-up pensions to reach the
moderate threshold for more than
12 years, while in London it would
deliver more than 15 years.
That’s a lot of pensioners in a more
comfortable financial position, while
also boosting the economy generally
given their enhanced spending power.
Normalising housing wealth
The report suggests a series of
measures which could make it easier
for homeowners to fully utilise
housing wealth in their later years and
supplement their pension saving, all
of which are eminently sensible.
For example, while it’s easy to talk
about the potential financial benefits
of downsizing – as well as the positive
impact this would have for families
looking to move up the housing ladder
themselves – all too oen such a move
is impractical.
A report back in 2023 from the
Centre for Ageing Beer, for example,
suggested around one in five older
people feel trapped in their current
home because of a lack of suitable
alternatives.
There is a clear requirement for
more housing aimed specifically at
– and which caters directly towards –
the needs of older people. Similarly,
incentives like a lower rate of Stamp
DAVE HARRIS
is CEO at more2life
Duty for downsizers would provide
the sort of helping hand that can make
all the difference for those on the
fence about such a move.
However, downsizing can only
ever be one potential solution to the
situation. There are plenty of people
who won’t want to move, as they
are in a home they love, filled with
memories of loved ones, and which
they have worked hard to pay down
the mortgage on.
They want and need to make use
of a solution that allows them to tap
into the proceeds of that sacrifice to
support their later years. That means
normalising options like lifetime
mortgages or other forms of later life
