Homeowners over 50 could be undervaluing their properties by an average of £43,060, according to research from SunLife.
The report found that homeowners in this age group have lived in their homes for an average of 22 years and purchased them for roughly £148,948.
These owners estimated their homes’ current value at £334,106, reflecting a 124% increase.
However, if those homes appreciated in line with the national average, they would be worth around £377,166, a 153% rise.
SunLife said this miscalculation could impact homeowners’ financial options, such understanding the benefits of downsizing or relocating to a cheaper area, which could free up cash for a better quality of life in retirement, or releasing equity.
On average, homeowners who used equity release accessed £62,848 in tax-free cash.
Many of them allocated the funds for home improvements (57%), debt repayment (33%), holidays (30%), income supplementation (17%), or assisting family (13%).
Mark Screeton, CEO at SunLife, said: “It’s no secret that house prices in the UK have risen a lot in the last few decades.
“But despite this, it seems many of us are still underestimating how much our home is worth.”
“Finding out the actual value of a home could open up financial options.
Screeton added: “For example, 1 in 4 people over 50 worry that they may have to move home in the future, even though they don’t want to.
“For some of them, equity release could be a way to stay in their own home while accessing the funds they need.
“But if they’re underestimating their home’s worth, they might not realise that this is an option.”
“Of course, equity release won’t suit everyone, so you need to speak to a financial advisor to learn more about the options that are right for you and your circumstances.”
