UK pensioners looking to unlock property equity

Despite the fact that more and more people have been increasing their mortgage payments, to take account of low interest rates, over the last two years, there is concern that many pensioners in the UK have in fact been reducing their equity stakes to pay off debts. This is a worrying trend and one which the UK government is acutely aware of with concerns about the potential consequences in the longer term.

While many pensioners will have held their current properties for many years, building up a potentially significant profit, it is the ever-growing cost of living in later years which is starting to hit home. The state pension has been falling in real terms for many years now and an increase in energy costs has hit many pensioners hard. By reducing their equity stakes they are effectively building up more problems for the future when they may need more expensive medical treatment, potentially a retirement home or there may be problems funding their basic lifestyle in the years ahead.

There is growing anger that many UK pensioners, having saved many years, are being forced to dispose of their assets simply to get by. Even though the UK government has announced that state pension payments will increase in line with the consumer prices index, this may not be enough for many.