AIBU to wonder why a pensioner struggling financially would not use housing equity?

[Powerbungalow]

I'm not being unsympathetic

Theres a lady on the news at the moment, saying how times are tough and shes only cooking one meal a week - imagine she's eating cold food.

One thing that stood out though "I own my own house and it costs in maintenance" Depending on where she is, would you not get a life time mortgage or sell and rent? She has a big asset, why not use it to have a better life? I know I would.

She may be holding on to it for inheritance, but she didn't say - if so, then can her family help. It just seems totally crazy

Apologies it’s on an example the OP posted with a £2m house bought for £125,000 and £9k a year charge

These examples are appalling. At least I know we won’t be putting anyone in the position of being responsible for monthly charges when we’re gone, we can’t afford McCarthy and Stone’s prices!

Many homeowners would love to downsize, us included. But we couldn’t cope with the insecurity of private renting now, and few social landlords will consider us. Our LA would rather house a healthy 55 year old renter into older people’s accommodation than a frail 80+ year old who owns their own home. They may have had similar levels of income, but made different spending choices, and for that one is considered more deserving than the other.

My kids are 55+, working and don’t think of themselves as old, who does even at 60 nowadays? Equity release wouldn’t give us the kind of one level accommodation we need, any suggestions from those who think our generation has it all?

That is a pretty appallingly written article, retirement flats or bungalows are not the only downsizing options

The tax issue - well yes stamp duty is a pain, it is a pain for all house buyers, particularly first time buyers. At least downsizers will probably have some equity they can use to pay it, unlike first time buyers who have to raid their deposits.

I am a big fan of reforming stamp duty, it does as currently structured, have some pretty perverse outcomes.

No - it says if you have an asset worth a lot of money - we dont want to hear how you cannot afford to eat or heat.

Haha - yes that’s what gets me- a lot have lost all sense of reality and it’s not just houses- many have a Ton of cash squirrelled away too - I do think the care situation is partly to blame - that’s why I think we need to do what Germany does - 3.4% of income is paid towards state funded nursing care of decent quality - my view is it should kick in at 40 and a maximum of £75k of assets can be used towards it-after that insurance kicks in - my father in law is86 and always trying to give us and our son lump sums and I’ve had to explain at his age and should he need care it could be seen as deprivation of assets , so we couldn’t comfortably spend it without it being asked for back . I think a bit of surety would help many older people feel comfortable about passing money down to younger family earlier.

Yes and where have I said that? I don’t know how we got to such selfishness in the UK but it’s awful to see the greed that goes with it.

What other alternatives for downsizing?

umm a smaller house? a cheaper area? A normal flat?

A cheaper area usually means less access to amenities like shops, a GP surgery, dentist and cafes. All the things you need to be near if you become unable to drive. Flats usually involve stairs which aren’t great as you age. Future proofing isn’t cheap.

We are in agreement again 😂

Oh dear. I’m a bit worried about myself! 😉

There is hope for you yet. I'll keep a seat warm on the Colour Free sceptics bench 😉

It’s not so much the size, it’s about accessibility, mobility and security. Like many older homeowners, we don’t have a large house, but the only bathroom is upstairs, and there’s no room for one on the ground floor. DH (80) has a health condition where the frequency of using a loo is increasing, along with other long term illness. If he has to go into hospital he may not be released, due to unsuitable housing. It’s one of the main reasons for elderly people bed blocking.

Selling their (often) only modest asset to fund rent for their last few years, without claiming benefits, saving taxpayers money, seems reasonable to me.

You can get council funding for accessibility adaptions if you are below a certain income.

Not sure if this is just in Scotland but my parents got a stairlift, a toilet rail and a bath chair fitted free and they had two private pensions and two state pensions, were home owners and had around £200k savings!

That doesn’t really help you if you’re miles away from shops, the dentist and doctors’ surgery and you can’t drive.

Which is why you need to consider your options for the future, then downsize and move if necessary while you are still able. I have no sympathy with people who claim to be living in poverty, while rattling around in some Victorian monstrosity, with a hole in the roof and rotten windows, which they can't possibly sell because it's their children's inheritance. The first thing the children will do in inheriting is sell the gothic ruin.

Great if the home is suitable for adapting. Many terrace houses have stairs too narrow for a stair lift. They’d be available for younger buyers if older people could find somewhere that met their needs,

@Somersetbaker In many cases poverty isn’t an issue. There is a vast difference between affluence and poverty. Big houses aren’t always the problem, small, cheap houses with no room for downstairs bathrooms are more common.

Inheritance? Our DC don’t need our money, they’d rather we use what we can to be comfortable. But our choices are very limited for reasons that have already been mentioned.

@Blossomtoes- my FIL at 85 did this - moved from Kent to Somerset - cheaperarea and banked £130k - now has detached bungalow, far more facilities on doorstep ( doctors, 2 general shops, minor injury centre, cottage hospital, pub, post office, bus stop, ( all within 3 minutes flat walk) , town and cafes, bars, restaurants, more shops, big market all within 15 minutes walk or a £5 cab . In his not very thrilling Kent village he had a weird shop, an awful pub , the doctor and a bus every 2 hours. It wasn’t as bad when he moved there in 2011, it just declined- he had 3 bed detached chalet style house there and a lot of land -

My comments about moving somewhere cheaper were in the context of moving within the same general area. Obviously that doesn’t apply with a move to another part of the country. Most people don’t uproot themselves and move a very long distance in their 80s.

Yep I do get that - you do get a few brave souls who do though , even in their late 70s and 80s - ny FIL had no reason really to be in that areas as moved for his partner who died in 2019 - the fantastic thing is he went to funky Frome, and it’s been great - community minded, lots going on and a lovely friendships club for over 65s he goes to twice a week - he’s had a new lease of life!!

The South West is a really popular place for pensioners from all over to retire to. It may have been a great move for your father, but not so much for Somerset Council. Somerset already had one of the highest proportions of pensioners relative to its working age population in the UK.

I am sure there must be smaller houses within the same araa for many people. Also ground floor garden flats are a thing.

I thimk a lot of the resistance to downsizing is people want to keep more bedrooms than they really use or a large garden.

I get it is not ideal, bit many peole have to make compromises due to finances.

But given the list of barriers people have presented - what would be their ideal downsize property (given the resistance many people have to new building)

So sell it, buy a 1 bed ground floor flat outright and use the proceeds to live on?