Sharp rise in equity release sales in August
There was a 52% surge in lifetime mortgages sales in August compared to the same month last year, according to figures from Responsible Life.
The later life lending specialist advised on £41m-worth of lifetime mortgages in August — up 51.9% from £27m in August 2019.
When drawdown facilities are included, the amount of lifetime mortgage business advised on by the company increased from £38m in August last year to £50m last month.
The broker added that retirees are increasingly look to equity release as part of their financial planning.
In June, Responsible Life’s sister company, the lifetime mortgage provider Responsible Lending, unveiled what remains the UK’s lowest ever fixed rate lifetime mortgage of 2.45%.
Steve Wilkie, executive chairman of Responsible Life, said: “The popularity of lifetime mortgages exploded last month thanks to a combination of low rates, robust property valuations in light of the stamp duty holiday and a desire among customers to secure their long-term financial arrangements following lockdown.
“The sector is certainly riding high and it will be interesting to see to what extent such strong annual growth rates can be sustained into the Christmas period.
“Funding for equity release products is liquid so the market has been able to satisfy this extra demand, while funding sources for other types of product have been more difficult to access, leading to a tightening in criteria.
“Equity release rates remain low and rate competition is still fierce. This will continue to draw new customers into the sector.”