- Equity release lending breaks quarterly, half-year and annual records
- Drawdown accounts for seven in ten new plans agreed
- More than 22,500 new plans agreed for the first time since 2008
- Market has doubled in size since 2011 and exceeds its pre-recession peak by 33%
Homeowners over the age of 55 unlocked a record amount of housing wealth via drawdown lifetime mortgages in the final quarter of 2015, pushing annual equity release lending to a new high of £1.61bn.
The figures, released by Equity Release Council, demonstrate the popularity of equity release has soared in recent years and is breaking new ground.
Lending via drawdown products totalled £271m in the last quarter of 2015, the largest quarterly total since this type of lifetime mortgage first emerged in 2004. Perhaps as a result of the heavily publicised pension reforms in April 2015, more customers are choosing to rely on their housing wealth, drawing it in stages to boost their retirement income as and when they need it.
Equity release lending activity by members of The Equity Release Council was pushed to an unprecedented £1.61bn: up from £1.38bn in 2014 – with 22,500 new plans agreed last year for the first time since 2008.
Geoff Charles, CEO of Bower said:
“The equity release market growth story is certainly an impressive one, with all the indicators pointing to strong demand. The forecasts are for further growth too, with predictions that it will easily break £2 billion this year and even £5 billion a year by 2020.
“New lenders are launching, with Legal & General making a major investment in the market, and rates have dropped below 5% for the first time which is fantastic news for homeowners. Coupled with the surge in house prices in recent years, particularly over 2015 when the average price climbed £18,000, it is a very exciting time for equity release. Advisers and their clients are clearly making full use of property wealth in this booming market.”
Equity release is not right for everybody of course, so Bower recommends anyone considering equity release to speak to an independent specialist in retirement lending before making a decision.
By choosing Bower, homeowners will receive a first-class and completely pressure-free service. Your specialist will take the time to explain everything thoroughly, including how equity release will reduce the value of your estate and how it may affect your entitlement to some state benefits. If you decide to go ahead, then we can take care of everything for you.
As a result of our absolute dedication to customer care, we are thrilled and honoured to have been awarded the Feefo Gold Trusted Merchant Accreditation 2016, which recognises Bower’s dedication to excellent customer care and top quality equity release advice.
