If someone bought a property few years ago with the intention of either using the funds for kids education etc or for retirement and has not stayed even a night in that property. Now due to needs,sells it. Does he have to pay khums on it as it was paid from khums free money(savings).?

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If with khoms free money, you mean the money of which khoms was paid, then he needs to pay the khoms of the profit only.
If he bought it for 100,000 and sold it for 150,000 he needs to pay the khoms of 10,000 (50,000/5).
While if the khoms of buying money was not paid, then he needs to pay the khoms of the whole 150000