Equity release grows in popularity
Data published by the Equity Release Council trade body said 5% more people took out a loan in the first six months of 2015 than last year.
More than half (58%) of new plans taken out were by people aged between 65 and 74 – the highest level ever recorded by the survey. Customers aged between 75 and 84 represented 22% of the market.
The value of total lending has also increased by 11%, from £641m to £710m, year-on-year.
The trade body said average rates had fallen by more than half a percentage point since December 2014.
More than 10,000 equity release deals have been completed in the last four half-year periods, the report said.
Nigel Waterson, chairman of the Equity Release Council, said: “The retirement landscape has changed considerably in the last year alone, but it remains a challenge for many people to save enough to support the lifestyle they aspire to.
“Appetite for using housing wealth as a source of funding in later life continues to grow, and equity release is playing an increasing role in helping people – especially those who are asset-rich and cash-poor – enjoy a better quality of life beyond the age of 55.
Simon Chalk, equity release expert at Age Partnership, added: “This is just the latest in a series of reports which prove that equity release is rapidly increasing in popularity. We are witnessing a shift in attitude, as more people begin to appreciate that their housing wealth can be used and enjoyed, just like any other asset such as savings and pension funds.
“This belief is supported by the tremendous growth in property values that most customers have experienced. As this coincides with fixed interest rates being so low, we can expect to see more homeowners opting for equity release. Our recent research found that average rates for customers reached a record low of 5.82% this year.”