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Homeowners 50+ could be sitting on an extra £43,000 in property value

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By Clare Yates • 20th January 2025 • 3 min read

Find out if you’ve been undervaluing your home

Written in line with our editorial policy.

Many UK homeowners aged 50+ may be significantly undervaluing their properties, according to new research. That means they may potentially be overlooking opportunities to rethink their financial options. 

SunLife’s latest Life Well Spent report found that older homeowners could have an average of £43,000 in additional equity – funds that could significantly enhance their quality of life in retirement.

Greater potential for long-term owners

The study surveyed over 2,000 people aged 50 and above about their finances and spending habits. It found that most respondents have lived in their homes for approximately 22 years. These properties were initially purchased for an average of £148,948, with homeowners now estimating their homes to be worth £334,106 – an impressive 124% increase.

However, it appears homeowners could be underestimating the real value of their homes. National averages from the Land Registry House Price Index show that a property bought in 2002 for £148,948 could now be worth £377,166. This reflects a 153% increase and indicates that homeowners may be undervaluing their properties by around £43,060 on average.

The report also highlights that almost a quarter of over-50s have lived in their homes for more than 30 years when properties were even cheaper. The potential for underestimated equity could therefore be far greater in some cases.

Given that one in four people over 50 have worries that they may have to move home in the future, despite not wanting to, it means potentially thousands of older homeowners may actually be able to keep the home they love.

Unlocking financial opportunities

While some are happy to consider downsizing to free up cash, others may find equity release a more preferable option, enabling them to access funds without the ordeal of moving.

For those that do tap into some of their equity this way, SunLife’s research showed that the average equity release customer accessed £62,848 in tax-free cash. These funds were most commonly used for:

  • Home improvements – 57%.
  • Debt repayment, including clearing the mortgage – 33%. (Think carefully before securing other debts against your home.)
  • Holidays – 30%.
  • Income supplementation – 17%.
  • Gifting money to loved ones – 13%.

When it comes to people considering equity release, the numbers look slightly different. They said that they’d like to unlock an average amount of £88,747 and they already know exactly how they’d spend their tax-free cash:

  • 46% indicated they would use at least part of the funds for holidays or travel.
  • 43% would allocate the money toward home improvements. 
  • 32% would use the cash to boost their income. 
  • 22% said they would put it toward taking early retirement.

How to check your home’s current value

For homeowners evaluating their options, an accurate property valuation is the first step to uncovering financial opportunities as the value will influence how much equity you can release. Here are some ways to assess how much your property might be worth:

  • Online valuation tools. Many property websites, such as Zoopla or Rightmove, offer free online valuation tools. By entering basic details about your home, you can get an instant estimate based on recent local sales data.
  • Consult a local estate agent. For a more personalised and accurate valuation, reach out to local estate agents. They can visit your property and assess its condition, which can of course affect the actual value of the property.
  • Check recent sales in your area. Research what similar properties in your neighbourhood have sold for recently. Property sales websites like RightMove allow you to check the sold prices in your postcode to see how the market is performing locally.
  • Review historical trends: If you know the original purchase price of your home, use the UK House Price Index to see how property values in your area have changed over time. This can give you an estimate of how much your home’s value has likely increased.

We should add that ultimately it is your chosen equity release provider’s assessment of your property’s value that will determine how much you can release. They may instruct a surveyor or other professional to inspect the property as part of their valuation process.

Importance of specialist advice

If you are thinking about equity release do remember that although a plan can provide financial flexibility, it is not a one-size-fits-all solution. Speaking to one of our selected advisers will ensure you understand all the benefits and drawbacks of a plan and whether there is actually a better option available to you right now. If there is, they will tell you. 

If your adviser thinks a plan would work well for you then they’ll compare plans from leading providers to find the best deal for your needs.

Find out if you qualify to release tax-free cash to boost your later-life finances. Get a free calculation online or talk to one of our friendly consultants by calling 0808 178 3055 or request a call back.

Sources:

Homeowners now estimate their homes to be worth £334,106: Equity release awareness and misconceptions. SunLife. Accessed 22 December 2024.

A property bought in 2002 for £148,948 could now be worth £377,166: UK House Price Index. Land Registry. Accessed 22 December 2024.

About Clare Yates. With over a decade’s experience writing about later life financial planning, Clare offers a wealth of knowledge about equity release, pension annuities, wills, LPAs and more. When she isn’t writing, Clare likes to spend her time baking and going on walks with her husband, two children and their rescue dog. Follow Clare on LinkedIn

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