Two thirds of all property wealth is held by people aged over 50, according to a new report from Saga.

The report shows that over 50s now hold a bigger share of the UK’s assets than before the financial crisis.

Saga is also predicting that this year will see an extra £1.5 billion of spending as new pension laws allow people over 55 to access their pension pot in one go.

Pensions and properties

The study, commissioned from the Centre for Economic and Business Research, found that 66.2% of all property wealth was held by over 50s – a massive £2.5 trillion worth. This is up from 65.3% in 2008.

In fact, they hold 68.3% of all UK household wealth (£7.8 trillion) and 77.3% of all financial wealth (£1.2 trillion).

These figures are up slightly from the same period in 2008 when the figures were 67.6% and 74.4% respectively.

Factors for these rises include an aging population, meaning there are simply more people over 50, and rising property values.

However, Saga’s research also shows that depressed bond yields and annuity returns have seen a drop in returns on savings.

While pension wealth has risen slightly from 70.3% in 2008 to 70.8% (£3.4 trillion), it is predicted that the decision to allow people over 55 to access their pension pot will soften this trend as they remove funds from their pensions and spend it elsewhere.

Stephanie McMahon, Head of Research at Strutt & Parker, comments: “Those over 50 are in the positive position of having significant equity within their homes, however, depressed pension returns has put greater pressure on how to get the most benefit from that equity during retirement years.

"Our analysis indicates that the UK’s housing shortage makes it increasingly difficult for this group to downsize as they are directly competing against those with young families upsizing.”

“We would encourage developers to look at housing solutions that are more tailored to this group, with excellent services and amenities, urban or near urban and with a flexible, well laid out space, something which we call Platinum Places in our Housing Futures report.”

‘No surprise’

Lance Batchelor, Saga’s chief executive says that it is no surprise that people over 50 have built significant wealth.

He says that saving and investing for the future not only benefits individuals but also the wider economy.

He has also welcomed the greater freedom in relation to pensions. He says that people should be trusted to make decisions on how they make the most of their retirement savings.

Figures suggest that the new pension laws will unlock an additional £1.5 billion of spending this year alone.

However, Saga has warned that people should make the best use of these pension freedoms and has urged people to seek unbiased advice or guidance on spending the money.