{"id":488247,"date":"2026-02-20T19:05:14","date_gmt":"2026-02-20T19:05:14","guid":{"rendered":"https:\/\/www.newsbeep.com\/ca\/488247\/"},"modified":"2026-02-20T19:05:14","modified_gmt":"2026-02-20T19:05:14","slug":"is-it-better-to-rent-or-buy-when-you-retire","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/ca\/488247\/","title":{"rendered":"Is it better to rent or buy when you retire?"},"content":{"rendered":"

It was the box hedge that prompted Anne Foster to think seriously about moving house. For 45 years, her husband had clipped the hedge at their five-bedroom family home in the West Midlands; after he died, the annual quote to trim it exceeded \u00a31,000. \u201cI thought, \u2018I have three children and seven grandchildren and can spend that money better somewhere else\u2019,\u201d Foster says.\u00a0<\/p>\n

Selling the family home is the obvious way to free up capital to fund living and care costs in retirement, and potentially release equity to family members. Foster considered various options and ultimately bought a two-bedroom cottage in Audley Chalfont Dene, an integrated retirement community (IRC) near Gerrards Cross in Buckinghamshire, nearer to her children. With her own driveway and front door, she could be independent, yet on-site care would be available if she needed it. The fact that she could own the house outright added to the appeal as she didn\u2019t like the idea of renting. \u201cThe problem we all face at this stage is that we don\u2019t know how long we will live and how much it will cost,\u201d she says. \u201cI don\u2019t like renting. It might be the answer for some people, but not for me.\u201d\u00a0<\/p>\n

Those born between 1946 and 1964 \u2014 the Boomer generation \u2014\u00a0tend to share Foster\u2019s view. But with price growth in the property<\/a> market stagnant in many parts of the UK, there\u2019s a quietly changing mood. More people are asking the question: if the time has come to move, is it better to rent than buy?\u00a0<\/p>\n

\"AChalfont Dene cottage, part of an Audley integrated retirement community, near Gerrards Cross, Bucks <\/p>\n

Approximately 74 per cent of those aged 65 and over in the UK currently own their homes outright, while only 6 per cent rent privately, according to the English Housing Survey. There has long been \u201ca social stigma about renting \u2014 people feel they\u2019re giving away their money and not getting anything back\u201d, says Nick Sanderson, founder and chief executive of Audley Group, the UK\u2019s largest retirement village provider, which operates Chalfont Dene. And, as Foster points out, if you\u2019re in the lucky position to be able to plan your retirement, you want to know you can afford your accommodation as care costs, if they come to bear, can spiral. <\/p>\n

Live-in care now ranges from \u00a31,200 to \u00a31,500 per week on average, rising to approximately \u00a31,800 for additional needs. Nursing homes cost from \u00a31,410 per week. \u201cCare is a major problem for people my age. People within my community are seriously worried,\u201d Foster adds.<\/p>\n

Given the record levels of wealth the Boomers accumulated through property ownership, it\u2019s only natural that they\u2019d look to it as a way of funding retirement. The housing market rose 25-fold between 1975 and 2025 with capital gains far outpacing inflation, according to Land Registry data. Homeowners aged over 60 in the UK now hold roughly \u00a32.89tr in housing wealth, representing 56 per cent of the nation\u2019s owner-occupied homes. This generation has a longer life expectancy than generations before them. (In the UK, average life expectancy is around 79 and 83 years, for men and women respectively, rising in wealthier areas.) This is making them even more reluctant to step off the housing ladder in retirement \u2014 why would they want to spend down their precious equity renting for two decades?\u00a0\u201cOnly about 5 per cent of callers ask about renting,\u201d says Paul Morgan of Wallacea Living, a new IRC in West London. \u201cRenting adds up and if you buy, you still have an asset to hand on.\u201d\u00a0\u00a0<\/p>\n

\"Line<\/p>\n

Yet attitudes towards renting in later life are beginning to shift. The English Housing Survey shows the proportion of private renters aged 65 and over has risen by about a third since 2009. Meanwhile the Pensions Policy Institute forecasts that by 2041 around 17 per cent of over-65s could be in private rented accommodation (almost tripling from current levels). Renting is also gaining ground within IRCs run by operators such as Audley, Pegasus and Auriens: about 10 per cent of units are now let across the sector, according to the Association of Retirement Community Operators (Arco). Knight Frank puts the current number of private IRC rental homes at around 4,500, and expects this number to double to around 10,000 over the next five years, following a trend towards renting that mirrors the US.<\/p>\n

Liz Greetham was in her early seventies and her husband in his mid-seventies when they moved into a rented two-bedroom apartment in Auriens Chelsea, an IRC a few minutes\u2019 walk from their previous home. They\u2019d seen similar communities while living in the US and liked the idea of distributing wealth to their children and grandchildren, and moving somewhere with lifestyle and wellness facilities to enhance their later life. They originally planned to buy a two-bedroom property and only moved into a rented apartment temporarily, but have decided to rent permanently. \u201cWe realised we like the flexibility of knowing that we can walk out if we want. The life enrichment programme is incredible and the restaurant and spa high quality \u2014 but if I gave in our notice today we could be doing something different in three months,\u201d Greetham says.\u00a0<\/p>\n

Greetham adds that she has lost confidence in the property market. Retirees are realising they can no longer expect meaningful capital appreciation: the mortgage squeeze,\u00a0sluggish GDP growth, and geopolitical and fiscal uncertainty has prompted both Savills and Knight Frank to forecast modest growth over the coming years.\u00a0<\/p>\n

\u201cBuying is fine if you know your home is going up 5 per cent a year, but now that it\u2019s not, an increasing number of downsizers are wondering if it\u2019s better to keep the money from their home sale and rent,\u201d says Sanderson.\u00a0<\/p>\n

\"AAuriens Chelsea; deferred fees promise to ensure that monthly service charges can be kept down \u00a9 Adam Parker \"AThe lobby at Auriens Chelsea \u00a9 Kensington Leverne<\/p>\n

But for those moving house in their sixties or seventies, the figures are still stacked strongly in favour of ownership. Analysis of Office for National Statistics figures by Standard Life suggests that, over the course of a 20-year retirement, an individual in rented accommodation will need to find, on average, an additional \u00a3398,000 in savings and pension income compared to a resident living rent- and mortgage-free, factoring in a 3.7 per cent increase in rent each year. In regions such as the north-east, this could be less \u2014\u00a0around \u00a3269,000 \u2014\u00a0but in London it stands to be much more,\u00a0approximately \u00a3833,000. Knight Frank estimates this to be higher \u2014 more than \u00a31mn, even before\u00a0any annual increase in rent has been factored in.<\/p>\n

Meanwhile, renters also face the uncertainty that comes with being a long-term tenant: Labour\u2019s rent reforms, part of the Renters\u2019 Rights Act being implemented in May, strengthen tenant protections, though landlords can still decide to sell the property or increase rent where permitted. \u201cYou need to have a good landlord,\u201d says Lucie Spencer, a financial adviser at Evelyn Partners, specialising in later-life planning. \u201cYou don\u2019t want to be left finding somewhere to live at short notice, and you need to know that you can adapt the property as you age.\u201d\u00a0\u00a0<\/p>\n

For Foster, now 86, who has lived very happily in her cottage for 10 years, buying a smaller home has paid off. She has budgeted for the monthly service charge and ground rent, and has no qualms about the deferred management fee (1 per cent for every year she\u2019s owned the property, capped at 15 per cent) payable to Audley when the property is sold, which will contribute to the upkeep of the retirement village as a whole. <\/p>\n

The life enrichment programme is incredible, but if I gave in our notice today, we could be doing something different in three months<\/p>\n

Liz Greetham, currently residing at Auriens Chelsea<\/p>\n

According to Henry Lumby of Auriens, which has 56 apartments for sale and rent, deferred fees ensure monthly service charges can be kept down and the operator is incentivised to keep their standards up. In Foster\u2019s case, she hopes the monthly fee (ranging from \u00a3700 to \u00a31,334, depending on property size, plus \u00a3500 annual ground rent) will be covered by capital growth when she sells. Cottages such as hers, bought off-plan for \u00a3800,000 in 2016, are selling for \u00a3950,000, which means that if she were to sell now, 10 years after purchase, the deferred charge would be approximately \u00a395,000.\u00a0<\/p>\n

Those moving now cannot bank on such gains, however. In addition, while there is a lack of resale data in new IRCs, high maintenance charges, exit fees and age restrictions associated with IRCs mean they can stay unsold for prolonged periods, according to Homeowners Alliance.\u00a0Knight Frank puts the average time it takes to sell a property in an IRC at just over 9.3 months.<\/p>\n

But properties outside IRCs are not moving quickly in the current climate either. Greetham, whose mother will be 99 this year and is living in a care home in Sussex, has experienced how tricky it can be to finance residential care if a property is taking time to sell. \u201cMy mother was lucky: my father was successful and a great BP pension comes in every month, but the money just goes out the door when you need care,\u201d Greetham says. \u201cWe\u2019ve burnt through all her liquid assets and the only thing we have left is the house she and my father retired to. But we can\u2019t sell it. Retired couples want it, but they\u2019ve always got a big family house to sell and no one is buying right now.\u201d <\/p>\n

The number of homes for sale is now at its highest level for 11 years, according to Rightmove. After exploring various equity release schemes without success, Greetham eventually discovered that Buckinghamshire County Council offers a deferred payment agreement, whereby a legal charge is placed on the property to cover the cost of care, repaid once the property is sold or from the estate.\u00a0<\/p>\n

\"AKYN Hurlingham, a care home in Fulham, West London. \u2018Resolving to rent in later life can take the pressure off \u2014\u00a0both emotionally and financially,\u2019 says its CEO <\/p>\n

For those in their eighties and nineties, moving into rental accommodation can help with liquidity. There\u2019s no stamp duty to pay and, in the case of those looking to move into dedicated retirement housing, none of the associated maintenance costs. Renting can also make more sense in an IRC, where owners must pay a monthly service charge plus ground rent and, in most cases, a deferred management fee on sale of the property, which can vary from 1 per cent to as much as 30 per cent, according to figures from Knight Frank, depending on the development and how long the resident has lived there. <\/p>\n

The average stay in an IRC is 7.4 years, according to Knight Frank. \u201cIf you\u2019re going to be there for less than that, it can make more sense to rent,\u201d says Tom Scaife, the agency\u2019s head of Senior Housing, adding that, in comparison, the average stay in rented retirement housing is between four and five years. \u201cIt seems crazy to pay these extra charges at this stage in your life,\u201d Sanderson says. \u201cIf you\u2019re delaying a move until later in life and don\u2019t see house price inflation while you\u2019re living there and there is stamp duty to pay and the associated fees of exiting, just think how much rent would have been covered.\u201d\u00a0<\/p>\n

As tenants, the Greethams are not responsible for the maintenance and upkeep of their property in Auriens. \u201cStudies show that, by moving to appropriate accommodation, you can have a higher quality of life for longer,\u201d Scaife says. \u201cPlus, as a tenant, you hold the sword compared to an owner \u2014\u00a0if the accommodation is not up to scratch, you can leave.\u201d <\/p>\n

By moving to appropriate accommodation, you can have a higher quality of life for longer<\/p>\n

Tom Scaife, head of Knight Frank Senior Housing<\/p>\n

A two-bedroom apartment such as theirs costs from \u00a33,995mn; renting is \u00a329,000 per month, not including utility bills. Nevertheless, Greetham is content with her decision to rent, even if it means they ultimately pay more over a 20-year period. \u201cWhichever way you do it \u2014\u00a0rent or buy \u2014\u00a0you\u2019ve got a finite number of years you can afford,\u201d she says.\u00a0<\/p>\n

\"WalledThe garden at KYN Hurlingham \u00a9 Christopher Horwood\"BookshelvesThe library at KYN Hurlingham <\/p>\n

Victoria Avon, a former lawyer whose father, Humphrey, moved into KYN Hurlingham, a high-end care and retirement home in Fulham, west London, two years ago, agrees that there is a value to be placed on liquidity for movers in their eighties and nineties. Humphrey, like many of his generation, was determined to stay in the family home for as long as possible and facilitating this was a priority for the family. Yet when round-the-clock care became a necessity, he was met with the combined cost of KYN\u2019s fees, which start at \u00a33,900 per week, plus the running costs of his house in West Sussex. \u201cI was worried we\u2019d run out of cash. In the end, we had to take a hit on the sale price of the house to get through,\u201d she says.\u00a0<\/p>\n

Those releasing adequate equity in their sixties and moving into a property with access to full care, such Auriens or Wallacea Living, can avoid this situation. \u201cIt\u2019s easy to forget when you\u2019re fit and healthy that your world can become very small very quickly \u2014\u00a0the earlier you can instigate and plan, the better,\u201d advises Lumby. Yet Avon is certain she could never have persuaded her father to swap his home for a property in an IRC \u2014\u00a0rented or bought. \u201cDad has never owned a leasehold in his life. He wouldn\u2019t have been interested,\u201d she says.\u00a0She agrees with Caroline Naidoo, chief executive of KYN, who maintains the financial decisions one makes in one\u2019s sixties and seventies are often very different to those in your eighties and nineties. \u201cResolving to rent in later life can take the pressure off \u2014\u00a0both emotionally and financially,\u201d she says.<\/p>\n

Recommended<\/p>\n

\"Illustrated<\/a><\/p>\n

Spencer, who helps her clients to plan their retirement strategically, insists there is no definitive right or wrong answer when it comes to renting or buying. Age, finances, health and family must all be factored into the decision. Humphrey agrees: \u201cIt\u2019s a grey area, depending on how long you\u2019re going to live and how much capital you\u2019ve got,\u201d he says. \u201cBut now I\u2019ve sold everything I\u2019ve got, there\u2019s a nice pot of money.\u201d <\/p>\n

Avon has no regrets that her father has exited the property market. She has witnessed friends struggling to sell their parents\u2019 properties in retirement communities once they die, in the meantime incurring service charge and ground rent. \u201cAt this stage of his life, it\u2019s freeing to be cash rich. We\u2019re ready to go,\u201d she says.\u00a0<\/p>\n

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