21% of Brits rely on their home for their pension

This is especially the case in the UK where consumers are placing their faith in property for their retirement, with over a fifth (21%) viewing their home as part of their pension - significantly higher than the European average (15%), according to the ING International Survey on Homes and Mortgages.

However, 61% of people across Europe feel that current house prices where they live are too expensive, with many unable to get a foot on the ladder.

It seems greater confidence is coupled with greater unaffordability, as one in four (25%) renters and homeowners admit to finding it increasingly difficult to pay their mortgage or rent each month. The report found tenants renting in Italy and Spain and homeowners in Romania and Turkey are struggling the most with payments.

The majority of consumers (56%) believe that prices will rise over the next 12 months, with confidence up by three percentage points from last year.

ING Senior Economist, Ian Bright commented:

“House prices are on the up in many European countries and consumers remain bullish that this will continue. As a result, we’re seeing more people viewing property as an important financial asset – including countries where renting is the norm – but there is also frustration with property being increasing unaffordable.“
 
Bernie Hickman, Managing Director, Legal & General Individual Retirement Solutions, added:

“It is a peculiarly British belief that ‘my home is my pension’ – so it’s no surprise to see that we’re the most likely in Europe to see our main residence as a key element of our retirement funding plans. Today’s over-60s in the UK own some £1.3trn of property wealth, and unlocking this vast asset base in order to fund better retirement outcomes is going to be a challenge for both consumers and the UK financial services industry over the coming years and decades.

“Given Brits’ general reluctance to downsize – and the lack of suitable properties being built for Last Time Buyers to move into in the UK – retirement lending is going to play an increasingly important role for those in retirement. Retirement lending is an idea whose time has come, and a greater range of more flexible products will help older borrowers. It’s crucial that our industry makes bolder moves to cater for older homeowners and enable them to access the money they need to fund their retirement. Advice will be paramount in this process if retirees are to make use of the assets they have built up over a lifetime to fund a better retirement.”