Older homeowners are spending their housing wealth now rather than using their accumulated equity to provide for their future long-term care needs, research by the London School of Economics and Family Building Society has shown.
The report, ‘Later life borrowing in a world that’s living longer’, has revealed that older borrowers’ priorities are more immediate, choosing to focus instead on helping family members financially or to support their own needs.
These present-day concerns include refinancing an existing mortgage, home improvements or helping with grandchildren’s education, for example.
Mark Bogard, chief executive of Family Building Society, said: “Housing wealth can only be spent once.
“Modern day families also have to consider how best to help their children and grandchildren who face their own set of financial pressures while having to plan for the looming issue of old age care and how to fund it.
“It appears that for the time being at least, their priority is on present day needs and not the future.
“The long-term implications of spending this wealth now are a massive issue with which government must help and create some semblance of order in a currently chaotic policy area.
“Our report makes the need for joined up housing and later life lending and care policies all the more urgent.”