Editor's note: This brief was summarised by The Property AI Newsroom from a report by The Negotiator. Read the original article for full details.

Landlords Face Surge in Pensioner Renters by 2044, ABI Report Warns

Letting agents and landlords could be dealing with more older tenants in the future, as new figures suggest one in three pensioner households could be renting by 2044. The Association of British Insurers (ABI) has reported that almost two million more people are expected to retire without owning their home, signalling a major shift in retirement living arrangements.

A report from the ABI, titled "Pensions Adequacy: Housing, Households and Auto-Enrolment," highlights that most of this growth will come from private renters. According to the ABI, the number of pensioners renting is projected to more than triple in the next twenty years, increasing by 1.3 million people.

The research, commissioned by the ABI and conducted by the Pensions Policy Institute (PPI), found that renters face much higher costs in retirement compared to those who own their homes outright. The analysis states that renting a two-bedroom home privately can cost between £200,000 and £400,000 throughout a person’s retirement. In contrast, the average defined contribution pension pot is £154,000, dropping to £105,000 for women. This means rental costs could consume a person’s entire private savings, leaving the state pension to cover all other expenses.

The ABI report notes that this trend creates new challenges for landlords and letting agents when assessing tenants and providing homes. The shift towards more pensioners renting privately may require changes in how the sector approaches tenant security and affordability.

Aaron Strutt, Product and Communications Director at Trinity Financial, commented that one in three pensioner households renting by 2044 is a high number, especially given that many landlords have left the rental sector and rents are already unaffordable for many people across the UK. He also noted that renting becomes more difficult in older age, particularly for those without substantial pensions or investments.