The third quarter of 2014 saw a record £375m in equity release lending. This is the largest amount seen in any single quarter since records began in 2002, according to the Equity Release Council.
ERC chairman Nigel Waterson saw the figures as positive, claiming this showed “equity release is proving an invaluable financial planning solution for over-55s approaching retirement as pension savings fail to cover rising costs.”
The full year to the end of Q3 2014 showed a 32 per cent increase in the value of equity release lending, and a 12 per cent annual increase in the number of customers. More than 5,500 over-55s released equity from their homes in the past three months alone.
The average value of equity release lending at £67,467 was also a record, representing a 9 per cent increase on the second quarter.
Mr Waterson said: “It is critical that we continue educating consumers about the benefits of equity release and increase the range of products at their disposal.” He added that input from government and regulators was invaluable and “further collaborations will extend the crucial role that equity release has to play in retirement planning”.
Adviser view
“I concur with Nigel’s comments” said Dean Mirfin, managing director of wealth and retirement options at Preston-based Key Retirement Solutions. “Pensioners are increasingly capitalising on the value of their homes,” he added.
Mr Mirfin said that despite the fall in property prices following the 2008 crash, people did not stop releasing equity from their homes “despite not being able to raise as much as before. If they can do it, they will do it.”
