Why Millions of UK Households May Rely on Property Wealth to Fund Retirement by 2040

More than half of all UK households could be relying on the value of their homes to fund retirement by 2040, according to fresh analysis from consumer group Fairer Finance.

The report forecasts that tapping into property wealth could unlock £23 billion annually and boost the UK economy by £21 billion. The growing dependency comes amid shrinking pensions, rising care costs, and increased life expectancy.

Nearly 40% of future retirees are expected to fall below the minimum recommended standard of living on pension income alone. The report urges policymakers to integrate property assets into mainstream retirement planning.

Key Recommendations:

• Build more downsizing-friendly homes where retirees want to live.
• Cut stamp duty for downsizers to encourage mobility.
• Promote housing wealth through guidance services like MoneyHelper.
• Create a single financial view combining pensions and property.
• Reform later-life financial advice to remove product bias and include all lending options.

James Daley, Managing Director at Fairer Finance, commented:

“Many people are sitting on significant housing wealth but aren’t using it as part of their retirement planning. With regulatory and social barriers in place, we're missing a major opportunity.”

The Equity Release Council notes that later-life lending already funds 45,000 UK jobs and could deliver a major economic stimulus if properly supported.

As the UK’s ageing population grows, the role of property in funding later life is becoming not only inevitable—but essential.