What To Do With A Property When You Retire?

*This is a collaborative post on what to do with a property when you retire

The UK property market represents big business, and one that’s growing larger with every passing year.

To this end, the value of the average home increased by around £16k through 2021, as the combination of high demand and a dwindling supply of houses created a perfect storm in the marketplace.

For older property owners, the temptation may well be to sell their property and downsize as a way of realising its full value. But what are the other things that you can do with your property when you retire? Here are some ideas to keep in mind:

Renovate

If you’re fortunate enough to boast disposable income or an accumulated source of wealth in your retirement, you could well choose to fund renovations that increase the value of your home further.

This not only serves as purposeful use of your time after you finish work, but it also enables you to chase a return on your investment and boost your retirement fund considerably.

Of course, the key is to start with a clearly defined budget, while identifying renovations that can translate into a viable percentage return. 

From here, you can oversee the project and then potentially have the property valued, before placing it on the market and looking to realise its increased value.

Equity Release When You Retire

If you’re over 55 and are eligible to apply for an equity release from your home, this can provide a lump sum cash payment or a flexible series of drawdown payments to boost your coffers.

The term ‘equity release’ refers to a means of realising your house’s capital value while still retaining ownership of the underlying asset, with the income available through different vehicles depending on your expectations and precise financial circumstances.

An equity release mortgage is most popular among over-70s, while it can offer you a significant source of income depending on your mortgage status and the residual value within your home.

This income can then be used freely and as you wish, creating significant flexibility to individuals during their retirement.

Move Into Rented Property

If you’ve paid off your mortgage, you could also downsize by moving to a different property and renting out your house.

With this option, the goal is to optimise the rental value of your property while seeking out a smaller property to move into.

The goal here is to rake in considerably more in rental yields that you’ll pay on your own tenancy agreement, realising this value as profit and banking the returns each and every month.

Over time, this can help you to accumulate considerable wealth, although much will depend on the rental value of your own home and the amount that you have to pay to landlords in the process.