Retirees increasingly tying up state pension in home, says mortgage index

THE typical retiree in Ireland has 27 years worth of state pension tied up in their home, according to lifetime mortgage firm Seniors Money.

The latest Seniors Money index said Dublin seniors top the poll with an average of 39 times the annual state pension tied up in their home. This, it said is almost twice as well off as they were ten years ago when they had 19 years worth of state pension in their home.

Wicklow came second and Cork city, took third place.

The index also found that home improvements have topped the poll of what is done with a lifetime mortgage, with 58% of customers choosing to reinvest their money in their home.

Debt consolidation remained a distant second on the list of possible uses for the money released.

Over a fifth of applicants said the facility of supplementing their income was one of the primary reasons for choosing to use their home as a financial tool.

Seniors Money chief executive Peter Mitchell said retirees in Ireland are in a much better position than many of their global counterparts since property prices here have risen at a much higher rate.

“The results from Seniors Money’s latest index would indicate that increasing numbers of Ireland’s ageing population are now choosing to boost their pension income by availing of the consequences of the Irish property boom.”

The index tracks consumer activity within this post retirement finance market.

It found that the loan approval amount has increased by over 50% since the first half of last year.

It also found in 2007 those who took a lifetime mortgage drew down an average of 11% of the value of their home.