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Rising number of older tenants

Journalist: Jake Carter, Mortgage Introducer

ended 02. August 2023

The number of renters over the age of 65 is set to soar over the next decade, as rising mortgage rates make homeownership increasingly unattainable, according to the English Housing Survey.

Is renting a good idea at that age? 

What are the advantages and disadvantages in the current market? When would you advise someone of that age to rent rather than buy?

How could these customers be supported into homeownership?

What advice do you give to prospective older homeowners?

5 responses from the Newspage community

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Editor
Michelle LawsonVerified
Director at Lawson Financial
Caution has to be applied at renting in older age as this will be a significant outgoing from a potentially diminished or decreasing income. Consideration should be made about how such costs would be maintained from pension (private or state) as well as general living costs. There are products such as Retirement Interest Only (RIO) mortgages and Reverse Joint Borrower Sole Proprietor where children can help parents with affordability which may help such applicants as an alternative to Equity Release. Advice should be sought and suitable plans made without leaving things too late to address otherwise the stark reality is you could end up losing your home.
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Stephen PerkinsVerified
Managing Director at Yellow Brick Mortgages
There are some advantages to renting in your later years such as having the flexibility to easily move closer to the family when needed, not being responsible for the property maintenance and of course, no risk of your home being sold to pay for your care.

I would estimate though, that the majority of people in this situation are there from circumstance rather than lifestyle choice. With House prices raising so much over the last 20 years and incomes not keeping up, those that did not have the opportunity to get on the ladder in their younger years with a long-term mortgage found it too expensive later in life.

If they want to buy now, they would need a large deposit, thereafter equity release or a Retirement Interest-Only (RIO) mortgage may be plausible options.
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Tahina AktherVerified
Barrister and Co-Founder at Wildcat Law
We are increasingly seeing in our divorces that older couples who previously owned their homes are forced to rent post-divorce as they simply cannot afford to buy separately. This is usually due to higher interest rates and shorter mortgage terms available to them making the repayments unaffordable.
The focus on mortgages being repaid typically during an individual's lifetime is one of the primary issues. With average house prices now so much higher than wages it must be time to look at more flexible products for older home owners, such as a part repayment, part lifetime mortgage (interest only) option. With the later repaid upon death.
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Joe Stallard0
Director and Advisor at House and Holiday Home Mortgages
Not everyone wants to own. For some people, at any age, renting is a choice. There's less responsibility for the property, more flexibility, and freedom for those who love to travel for longer periods of time. Having said that, it's also true that there's a growing cohort of people over 60, still working and enjoying life. For various reasons, they may not have wanted to - or have been unable to buy in the past. But as they move towards a more settled life (travel bug finally shaken out of the system, divorced and starting a new life etc.), they'd like to see more mortgage products avaialble to them. With no intention of retiring any time soon, and with plenty of years ahead -- we're all living longer -- this is something that would really make a difference.
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Rhys SchofieldVerified
Brand Director at Peak Mortgages and Protection
The sad reality for many is that if you retire and don't own your property outright, many people are condemned to a miserable retirement living in poverty. Private rental on a meagre pension just isn't an option for many with rental prices through the roof and social housing is like hens teeth. This is exactly why lending into retirement needs to be treated very carefully indeed!