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bigger textLease for Life - Living it
The house of your dreams, without mortgage and without rent - that's the tantalising prospect being offered by financial company Homewise. With their Lifetime Lease, they say you can move into a home for a fraction of its value, but is it all too good to be true?
According to Homewise's Pensioner Property Price Index, retired households within the UK have gained on average £21,282 - around 27% of the total value of owner occupied property in Britain - with 93% of them being owned outright. With many pensioners now struggling to make ends meet, the Lifetime Lease seems the perfect way to free up some of that capital, but live rent free in a home of their own.
"It's staggering to see the amount of money tied up in pensioners homes, and worrying that despite this an increasing number of pensioners are experiencing financial difficulty," says Mark Neal, managing director of Homewise. "If people can look past the stigma attached to not owning your home outright, there is a huge potential to use this money to avoid the pitfalls of lower income and afford the dream retirement."
A Lifetime Lease allows you to move into a house that would previously have been out of your reach for a substantial discount, on average around 40%. All you do is pay a lump sum to the company, usually taken from the sale of your existing home, and you can live there rent and mortgage free for the rest of your life. You can also pocket the difference allowing you to pay off debt, supplement existing income, or give to relatives.
"We're enabling them to get off the property ladder in order to help those around them onto it," says Homewise marketing director Suzanne Sullivan. "We find that many people like to see their grandchildren enjoying the money while they're still alive rather than passing it on and not seeing the benefit they give them."
The scheme is proving popular with people who want to maintain their current standard of living after retirement, or find that perfect spot in which to while away their old age. "Typically people want to retire down to the south and the coastal regions," explains Suzanne, "but the property values are quite high, above market average, so they can't afford to move into that property. The primary desire is to move rather than release money."
Homewise not only buys the property; they also offer support in finding the right place. "We can find that property for someone or they can find it themselves. Sometimes people have found the property but can't afford it at market value so we'll buy that property for them and provide it back to them on the Lifetime Lease," she continues. "Alternatively, if they find the process daunting, we do the search for them."
There is no shortage of customer testimonials on hand to eulogise about the service they're received from Homewise. Take Mr and Mrs Green who were able to move back to the Cornish town of Port Isacc. Having left some years before they were taken aback to find that property prices had shot up since their departure, but the Lifetime Lease brought prices back within range. Their bungalow, priced at a hefty £280,000, was reduced to £191,000, a saving of £89,000.
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