New research by Aviva has looked at the attitude to spending, saving and retirement in the over-45s, to include the length of time homeowners are staying in one property before moving on.

There has been a reduction in levels of property ownership compared to the figures from six years ago, both among those with mortgages and those who own their properties outright.

Currently, 16% of 45-54 year olds own their property mortgage-free, down from 23% in 2016. For the next age group up, those aged 55-64, only 45% own their property mortgage-free, compared to 48% in 2016. This suggests that mortgages may currently be being paid off later in life than previously.

The next age group up, those aged 65-74, still had some homeowners with a mortgage. Currently the figure stands at 13%, with 9% back in 2016.

Time living in one property

The amount of time people are spending in their property before moving house has stayed fairly level at just under 20 years currently, down slightly from 21 years in 2016. Those who have currently spent 20 years in their home would have bought in or around 2002 when average house prices were £101,000. Their properties are now worth considerably more.

Those who are mortgage-free have lived in their properties for 22 years, compared to those who have a mortgage, who have been there for 16 years. This means that those who don’t have a mortgage have seen an extra six years of increase in equity in their home.

House price increases

Average house prices have increased for this group from £264,000 in 2016 to £287,000 currently. This is an increase of 8%.

For those who bought before the house price boom of the 1990s and who are in the 75+ age group, their home is worth on average £310,000 and they have lived there on average for 28 years. In 1994, the average house price was £54,623, meaning their equity has increased five times.

For the 65-74 age group, they have spent an average of 24 years in their home, meaning they bought in 1998 when average house prices stood at £66,231. This has increased to £302,000 in today’s prices. For most individuals, this is far more than they will have accumulated in savings and investments.

If the average amount owed on a mortgage is deducted, the amount of equity held in property is just under £195,000. The average amount held in savings and investments is £52,000, showing why all assets should be taken into account when planning for the future.

Matt McGill, MD at Aviva Equity Release, said:

‘In the years since we last carried out this research, significant events have impacted the way people feel about the economy, their futures and their retirement plans.  Understandably, a much larger number of people are now citing worries about the economy as their major concern in retirement.

‘Despite all this, the housing market in the UK has been on a steady upward trend since many current retirees bought the home they still live in. But less than half (42%) of the people we surveyed said that their home was worth more than their savings and investments, yet the facts show that people’s property equity is worth almost 4 times as much as their savings.  It’s likely that people have accumulated more wealth in their property assets than they realise, and looking at ways of utilising this in planning for retirement could have a significant impact for them. It’s an important factor to consider when looking to plan for a comfortable retirement.’