Equity release lending hits to all-time high
Figures from the Equity Release Council showed £384.3m of lending was completed in April, May and June. This is the highest total the trade body has ever recorded.
Homeowners aged 55 and over withdrew around £4.2m of housing wealth every day during the second quarter of the year, with 5,400 new people using equity release.
It said this increase was despite the government’s pensions freedoms coming into force on April 6.
House prices have continued to rise and more people are looking to their properties as a source of income in later life.
In the year so far £710 million of equity has been withdraw, 11% higher than the same period last year. More than 10,000 people used equity release for the first time in the last six months.
Nigel Waterson, chairman of the Equity Release Council, said the financial outlook for retired people was changing.
“The last three months have been a landmark period for UK retirees and those approaching retirement, and equity release activity continues to grow amid a sea of change,” he said.
“There is no doubt the pension freedoms have created more options for people to consider, but the appeal of tapping into housing wealth is on the rise as older consumers seek to make use of all the assets at their disposal.
“Doom and gloom often surrounds discussions on retirement income, but while contributions to pension pots remain low, an entire generation of homeowners have been paying into property their whole lives: making it an asset that can transform their financial options beyond the age of 55. Anyone seeking advice on how to plan their retirement should consider their property as a valuable source of wealth.”