27 Jul 2020
New data from the Office for National Statistics has revealed that people of retirement age in England are leaving major urban areas and settling elsewhere1. Using the data, Legal & General Retail Retirement can reveal the top 10 Retirement Migration Hotspots, where those aged over 65 are setting up a new life.
Dorset, Shropshire and Wiltshire are the English local authorities most likely to see an increase in the number of people aged over 65 moving in2. This corresponds with a broader trend of older people living in rural areas, by the coast or in areas of outstanding natural beauty. Meanwhile, the local authorities that have seen older people leaving are more likely to be cities with 87% of Major Urban areas experiencing net departures of those aged 65 years and over, as of June 2019. London saw the most departures (over 10,000) and boroughs within the city account for the majority of the top 10 most exited areas, followed by Birmingham, Bristol and Manchester.3
|Local authorities with the largest number of people aged 65 years and over entering in the mid-year ending June 2019
|Local authorities with the largest number of people aged 65 years and over leaving in the mid - year ending June 2019
|East Riding of Yorkshire
In some cases, it is possible that financial reasons could play a role in people choosing to settle elsewhere. For instance, a homeowner aged over 65 choosing to sell the average property in Outer London (£424,200)4 could receive a nest-egg for their retirement if they were to buy the average property in Retirement Migration Hotspot Dorset (£324,707)5, particularly with the recent changes to stamp duty rules. However, these incidents of ‘townsizing’ – where someone frees up funds by buying a new property outside the city – are not necessarily universal. The average house price in Birmingham, for instance is only £194,9716, by comparison. This could indicate that people are also potentially driven by lifestyle considerations.
Aside from the obvious lifestyle benefits of living in areas of outstanding natural beauty, the Covid-19 pandemic could play a role in retirement aged people’s future migration plans. Recent research from Legal & General Retail Retirement found that people aged over 50 in cities rather than rural areas were slightly more likely to fear contracting the virus and were more likely to feel their mental health had been impacted during the crisis. However, despite this, levels of anxiety and stress were generally consistent whether someone lived in the country or the city. 7
Chris Knight, CEO, Legal & General Retail Retirement: "There are a number of reasons why retiring to a rural or coastal location can be attractive, even if someone has lived their entire life in a major urban area. In many cases, the cash from selling a city home can create a nest egg and help with retirement income. People might also want to move for health reasons, particularly in light of the challenges presented by the Covid-19 crisis. However, for many people the attraction will be the perceived slower pace and better quality of life; living in a rural idyll or coastal retreat is a long-term aspiration for many people and retirement provides an opportunity to realise that dream.
The Covid-19 pandemic has brought many aspects of our lives into sharp focus and will likely make many people of retirement age reassess their priorities. These figures from June 2019, show that there was already a trend toward migration out of urban areas for retired people and I anticipate the pandemic will only increase the number of people looking for a new life outside the city."
Established in 1836, Legal & General is one of the UK's leading financial services groups and a major global investor, with over £1.2 trillion in total assets under management* of which 39% is international. We have a unique and highly synergistic business model, which continues to drive strong returns. Legal & General provides powerful asset origination and management capabilities directly to clients, which also underpin our leading retirement and protection solutions. We are a leading international player in Pension Risk Transfer, in UK and US life insurance, and in UK workplace pensions and retirement income. Our purpose is to improve the lives of our customers and create value for our shareholders. Through inclusive capitalism, we are investing in long-term assets, such as real estate and infrastructure, that can help build a better society for the future.
Legal & General Retail Retirement’s mission is to help its customers lead longer, healthier, happier lives. We believe everyone should be able to have a ‘more colourful retirement’. The Division comprises the Group’s retirement savings and income, later life lending and care solutions businesses. In 2020, LGRR wrote £910 million of annuity premiums and issued £791 million of lifetime and retirement interest only mortgages.
*at 31 Jun 2021