If the elderly people in the film have lived rent- and payoff-free for the last 20 years ".
There we have it.
Either one has not invested anything since paying off the loan – so indeed lived rent-free – and was able to save the money. But then the house is in need of renovation, and that has a massive impact on the sale price. However, one has at least saved their money by now.
Or one has maintained the house, replaced and adapted bathrooms, floors, heating, windows, electricity... at reasonable intervals... Then the house is in good condition and certainly can be sold at a significantly better price. Whether you get the investments back 1:1, no idea, I rather think not. But you also lived comfortably.
Sometimes it is shocking when you walk through the city and see houses – old windows simply glazed, plaster crumbling in gray-brown GDR style, no insulation, electricity obviously untouched since construction... Inside an old lady living in the modest standard of 1930. Of course, she won’t get a good price for her house! Probably not even in the big city... But I have at least seen such a cottage where the buyer really made something out of it, amazing, honestly!! He basically only bought the land and then invested as much money as would be required for a new house.
Of course, there really are areas with ZERO interest, neglected and completely without prospects (no jobs for anyone), where you actually can’t build a house because the construction costs are no longer worth it even before moving in. There, an existing house is also not a "retirement provision."