For many, the traditional property journey involves renting early on, progressing to homeownership, paying off the mortgage, and eventually downsizing in retirement.
Most downsizers choose to buy, fearing that renting might deplete their estate and leave less for their children. However, in the UK The Times found a growing number of wealthier retirees are challenging this norm, opting for the flexibility and reduced responsibilities of renting in their later years.
Renting in retirement can eliminate the stress and expense of property maintenance, simplify relocation, and free up capital for other uses.
For those moving into retirement developments, renting also avoids the challenges of selling properties that often come with high service charges and exit fees. However, this approach suits only those who can comfortably cover the rent through a mix of income and savings.
The Times interviewed Norman (83) and Rita Johnson (82, pseudonyms) who are among those who have embraced renting. They sold their family home in rural Somerset 18 months ago and moved into a two-bedroom bungalow in Wells, rented from a private landlord. Their motivation was to simplify life, reduce driving, and ensure financial flexibility.
“We decided to rent rather than buy so we could invest the proceeds of the sale to provide additional income, potentially to cover future care costs,” said Rita. “We also wanted to be relieved of the responsibility and expense of maintenance.”
The couple uses income from pensions and investments to cover the rent. Rita noted, “Whenever we have a small maintenance problem, the landlord has dealt with it immediately. We are very central and don’t need to use the car often — walking has been great for our health.”
Weighing the risks
Despite the benefits, renting can bring uncertainties. The Johnsons’ tenancy began as a one-year assured shorthold agreement, which has since rolled into an open-ended contract. Although their landlord’s plans to eventually use the property for his own retirement provide some assurance, they acknowledge the potential for change. “We feel pretty secure, but of course this could change and we could be asked to leave,” Rita said.
