According to the June 2012 HomeLet Rental Index, in Q2 2012 tenants aged between 66 and 70 have seen their average income decrease by a significant 16% over the past year. Tenants aged between 56 and 65 have also seen a drop in their annual income by 8% over the same period.
In addition, this month’s HomeLet Rental Index shows the percentage of tenants aged between 66 and 70 who have moved into rented accommodation from a home they owned has increased by 2% to 43%, when compared to Q2 2011.
Ian Fraser, HomeLet’s Managing Director, said: “It seems retirees could be forced to eat into their savings to pay for the rising cost of living. The price of food, petrol and utility bills have rocketed in recent years, hitting people in the pocket.
“This is reflected by the drastic drop we’ve seen in older tenants’ disposable incomes over the past year. In contrast, the average cost of renting a home in the UK has increased by over 2% in the past year, and now stands at £768 per month.
“Despite this, we’ve already seen an increasing number over 55 year olds moving into the private rented sector from a home that they previously owned. With activity remaining low in the sales market and uncertainty over house prices, the flexibility of the private rented sector may appeal to many older homeowners, particularly those who have a considerable amount of equity in their home.
“With falling incomes from pensions and investments we could see further increases in the number of older tenants who are reliant on the equity released from selling their home, but those who aren’t in that position could really struggle with any further increases in rental values.”
To read the full report visit the HomeLet Rental Index page on our website.