More than a third of over-50s have more than 10 years left on their mortgage, the latest research from Regency Living has revealed.
The survey of over-50s homeowners revealed that 88% are still paying off their mortgage, and 36% have more than 10 years of repayments left before it is fully paid off.
With the current average retirement age in the UK currently standing at 66 and expected to hit 67 between 2026 and 2028, this means that a large proportion of homeowners will still be paying off their mortgage well into retirement.
Despite this, only 6% of respondents said that they have considered equity release to help pay off their mortgage.
Of those, 57% had considered releasing equity through a Lifetime Mortgage, while 34% considered downsizing their property.
Regency Living’s analysis of house price data showed that the current average price for a detached home in England is £459,675.
If a downsizer were to sell their existing home at this price and use the funds to purchase a flat, for which the current average price is £252,604, they could generate an equity release of 45% (£207,071).
However, if downsizing to a park home instead of a flat, the potential equity release is significantly higher.
The average price of a park home property in England is £144,748, therefore, downsizing from a detached house would generate an equity release of 68.5% (£314,928).
In the hugely popular park home regions of the South East and South West, the equity release potential release is even greater still at 77.4% (£496,885) and 70.1% (£338,897) respectively.
Tim Simmons, sales and marketing director at Regency Living, said: “Downsizing is a great way of ridding yourself of mortgage debt before you enter retirement, freeing yourself of any concerns about being able to afford repayments once the reassurance of a regular salary is gone.
“And by downsizing to a park home, the amount of cash you’re going to release will not only cover any outstanding mortgage loans and buy your new home, but could also leave you with a handsome lump sum to put towards living your retirement to its fullest.”
He added: “Park homes aren’t only a great downsizing choice because of their relative affordability, but many park home providers offer a part exchange service, allowing you to not only secure 100% of the market value of your home, but also providing you with a concrete timeframe with respect to your home move.
“Park homes also provide you with a safe, secure home where you can live as part of a like-minded community surrounded by neighbours of a similar age.
“Park home sites are also often located in some of the country’s most beautiful and desirable areas, whether it’s the Great British countryside or overlooking our magnificent coasts.”
