Equity release used increasingly to help friends and family

5 June 2019

Key reasons for equity release remain constant 

The most popular reasons for people taking out over 55 equity release schemes remained the same last year as they were in 2017, however more people used it as a way of helping friends and family. 

Popular uses of equity release

20171

20182

Home and garden improvements

64%

64%

Go on holiday 

33%

33%

Pay existing debts 

31%

31%

Treat or help family or friends 

24%

27%

Clear outstanding mortgage

22%

22%

Help with regular bills

12%

12%


With people living for longer, it’s inevitable that we are having to rethink how we help our children and grandchildren, so it’s not surprising that the proportion of equity release schemes that were taken out to help loved ones has gone up,’ commented the director of 55+ Equity Release, Jan Johnson. Our growing life expectancy means intergenerational wealth management is changing; with people inheriting now typically between the aged of 55 and 64 – potentially beyond the age of retirement – more and more people are looking for ways to help their loved ones while they are still alive, and equity release is often a relevant solution.’

Key regional variations in equity release 

Total equity release lending increased in every region in 2018, with the South East continuing to lead the field, largely due to the higher average house values (only outstripped by the capital, where average property prices were 50% higher), with the average amount of equity released by region reflecting average property prices. The average age of equity release customers has become slightly more diverse across the country; in 2017 customers were on average aged 72 across all regions, but the average age went down slightly last year in the East Midlands, North East, North West, West Midlands and Yorkshire and Humberside, but increased slightly in London. 

Region

Value of equity released

Year on Year increase2

Average value released

Average customer age

Average property value

20171

20182

20171

20182

20171

20182

20171

20182

East Anglia

£206m

£242m

17%

£69,957

£70,241

72

72

£269,120

£269,360

East Midlands

£194m

£244m

26%

£61,457

£59,731

72

71

£237,428

£236,709

London

£558m

£664m

19%

£133,687

£136,849

72

73

£603,610

£591,630

North East

£57m

£75m

31%

£53,171

£51,993

72

71

£182,135

£184,583

North West

£184m

£242m

32%

£56,638

£57,348

72

71

£205,484

£213,299

South East

£954m

£1,048m

10%

£90,789

£88,965

72

72

£397,840

£385,017

South West

£374m

£421m

13%

£76,205

£75,900

72

72

£306,721

£306,665

West Midlands

£163m

£223m

37%

£59,787

£61,422

72

71

£223,442

£229,441

Yorkshire & Humberside 

£121m

£164m

36%

£53,845

£55,019

72

71

£204,047

£210,004


With the total amount of equity released increasing by between 10% and 37% in every area of the country in 2018, we anticipate that more people will release equity from their homes this year to help them realise their retirement dreams. 

SOURCES

1 Equity Release Market Monitor, Full year 2017

2 Equity Release Market Monitor, Full year 2018

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