Retirement income in doubt amidst property crisis

More than a quarter of people in the UK aged 55 to 64 are relying on property to fund their retirement, according to a new report.

And 1.7 million pensioners are already relying on property to fund their old age, according to the report from price comparison company uSwitch.com.

It says that the 26% of future retirees relying on property could find themselves in a very vulnerable position because of the real estate slump. Falling property prices will hit them hard.

The report also found that just over one in ten 55 to 64 year olds think they cannot afford to retire, with 18% of over 65s who are still working saying they cannot afford to retire either.

'Falling house prices coupled with the stock market crash and low savings rates have combined to take the wind out of the sails of many of those approaching retirement,' said Ann Robinson, director of consumer policy at uSwitch.com.

'Despite recent reports of a 0.9% property price increases, this is a drop in the ocean compared to the overall 15.7% decrease in prices over the last 12 months,' she added.

It is predicted that an increasing number could choose to downsize in order to cash in before property prices fall even further as many analysts predict that the UK property market has not yet reached the bottom.

'There isn't an instant solution, but that doesn't mean people should just bury their heads in the sand. They should still be planning and making sure that they are on the best financial footing possible,' said Robinson.

'As the UK population ages and pension provision appears to stall, the UK is facing a very real retirement funding crisis,' she added.

BOOKMARK THIS PAGE (What is this?)