Retired renter numbers set to soar
The number of retired people renting is set to soar in the coming years, reaching one in eight pensioners by 2032.
Equating to over one million people, this will be three times the current figure and paying for this will prove difficult for many, according to a study by Scottish Widows.
Its report, based on a study by Development Economics, has revealed renters aged over 50 are saving around £6,300 a year - or £525 a month - too little each for their retirement years. Put together, this is a combined shortfall of £43 billion.
According to the projection, the average renter retiring 15 years from now will spend 42 per cent of income on rent, with this demographic needing to save an extra £525 a month on top of their pension contributions or work 5.1 years extra beyond retirement age.
However, 67 per cent of those aged 50-64 who expect to rent in retirement have no plans to save this extra amount, while 68 per cent of those who could consider raising their contributions say they would need a pay rise to be able to afford it.
The issue suggests that landlords more used to dealing with younger tenants in the student sector or those renting as they have yet to get on the housing ladder will now have to contend with a demographic timebomb.
Similarly to other housing issues, London will be hit worst by the problem and the south-east and East of England are expected to be be increasingly unaffordable. By contrast, the situation in north of England and Wales will be more favourable, although still less than now.
Commenting on the situation, Scottish Widows retirement expert Robert Cochran said that although some might choose to rent in retirement, many will be left with no choice.
He added: "We’re therefore urging the government to consider ways to refine the housing market to better suit older renters - through options such as open ended tenancy, with predictable rents and protection."
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