RETIRED homeowners are shunning owning their own home to join the 25 per cent of retirees who already rent - with debt the main reason for the move.
More than two in five of these retired renters are former homeowners who, for a range of reasons, have made the decision to sell.
The Prudential study found that the decision to sell their property and move into rented accommodation was mainly driven by finances - around 40 per cent were forced to sell their homes to pay off debts, 19 per cent needed to release funds in order to cover the cost of a divorce or separation, and nearly one in ten sold in order to use the money to boost their retirement income.
But on average it then left them with higher housing costs.
According to the study, retired renters pay an average rent of £423 a month, roughly two-thirds more than the average mortgage repayment paid by retirees who still have home loans, of £257 a month.
Almost one sixth of retired renters choose not to own their home as a lifestyle choice, says the report, while 35 per cent say they rent because they do not have enough money for a deposit to buy a property and 41 per cent cannot afford home ownership. The majority of retired renters (58 per cent) have never owned a home and nearly three quarters of them plan to continue renting for the foreseeable future.
Seven per cent used some money from the sale of their property to help their children get onto the property ladder, while nine per cent used the money to help support their children in other ways.
Stan Russell, a retirement expert at Prudential, said: "Renting in retirement can make financial sense and accessing property wealth to boost retirement income is a genuine solution for many. Our research shows that many retired renters are perfectly happy with this arrangement.
"However, retirees should be aware of the extra financial burden they could be taking on if they choose to sell up and rent."
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