Old Money’s Influence

Many property commentators point to the first time buyer as a primary stimulus for the property market. While many property-related transactions are indeed reliant on somebody somewhere down the chain buying without being dependent on a related purchase, the influence of “old money” is often overlooked.

The value of housing assets left in wills every year has more than doubled in the past decade, to over £450bm that will pass from one generation to the next, with many of the fortunate recipients splashing out their new-found wealth on a new home.

(source Halifax).

As the baby boomers begin to retire, so their influence on the market will be felt, with about 27% of the population of the UK (or 15.8million) falling into this category. An older, healthier, more mobile population is also likely to move house more frequently than their parents and grandparents did, and they will play an important part in the intra-generational transfer of housing wealth that is to come.

More baby boomers (78%) own their own home than any other UK age group. In addition, baby boomers have witnessed an extraordinary transformation in British society: the rise of owner occupancy. In 1946, an estimated 31% of households owned their own homes – today’s figure is nearly double that! The wealth held in property is likely to be used to assist the next generation in both housing and pension gaps.