Homeownership trends impact retirement security in US and UK

Data from the Federal Reserve indicates that homeownership among Americans peaks between the ages of 65 and 74, reaching approximately 81%. By their late 60s, about 73% of retiree homeowners are mortgage-free, a figure that rises to over 90% by the mid-80s. While owning a home outright can lower living costs during retirement, financial experts note that prioritizing mortgage payoffs is not always the most effective financial strategy for every individual.

In the United Kingdom, research from PensionBee suggests that homeownership is a primary driver for retirement planning. A survey of 2,000 UK adults found that 51% would be willing to delay their retirement to ensure they own their home outright. For 45% of respondents, outright homeownership is considered more important for retirement security than maintaining a large pension pot.

However, projections from the Pensions Policy Institute warn that the UK pension system may be facing challenges, as nearly two million more pensioner households are expected to be renting by 2044. Rising house prices and longer mortgage terms continue to impact the ability of many to achieve outright ownership before retirement.