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One in five tenants in the private rental sector is retired

Depositphotos 59876923 m-2015 (1)

Nearly one in every five tenants (19.96%) in the private rental sector (PRS) is retired reveals new data - a rise of three percentage points since the end of 2016.

There has also been a 13% increase over the last 4 years in the number of older people and retirees moving into rented accommodation, with figures from the National Landlords Association (NLA) showing that between 2012 and 2016, the number of retired renters soared by 200,000.

The data shows that it is not just the priced-out younger generations who are swelling the number of PRS tenants, but older generations too.

A spokesman from the NLA said that property maintenance is a major burden that encourages older people to rent: "Homeowners can often feel oppressed by the costs and stress of upkeep, especially when things go wrong and they don't know who to turn to. 

"Being a private renter is relatively stress free."

Pros and cons of renting in later life

A spokesman from financial advice firm Chase De Vere said one benefit of renting is that there is far more flexibility in terms of where you live. It's "much easier and cheaper to move" as a tenant, he said, adding that renting may boost retirement income as older people may be able to save larger amounts into pensions and investments because they don't have money tied up in property.

But he also warns of the risks.

Apart from the obvious - tenancy agreements do not last forever – by selling their main property, wealthier homeowners will lose their entitlement to the new, additional inheritance tax (IHT) exemption - known as the "main residence nil rate band" - which started to phase in from April this year.

It offers individuals an additional IHT allowance when they pass their residence to direct descendants, meaning that somebody in rented accommodation faces a bigger inheritance tax bill.