Equity Release increasing in popularity amongst under 65s

Published: 25/03/2015

The recently published Equity Release Market Report highlighted that the 55 – 64 year olds share of the market had increased to 20% in the second half of 2014, up from 17% in the first half of 2014. This increase is in sharp contrast to the previous trend – in 2011 the proportion of customers to release property equity aged between 55 and 64 was 24% and this dropped to 21% in 2013.

In this latest report the average lump sum released was £69,118 – considerably larger than the average defined pension pot of £25,000!

There are a number of likely explanations for the increase of Equity Release customers aged 55-64 over 2014. A pension pot of £25,000 isn’t going to deliver much by way of a pension and so many pre-retirees who have a lot of wealth tied up in their home will use that to fund their lifestyle from the point of their retirement.

For others Equity Release provides a solution to those aged under 65 who are finding it more difficult to obtain a residential mortgage following the Mortgage Market Review (MMR). People in that situation are now looking at a wider range of options and, for some; the flexibility of Equity Release is very attractive.

Richard Espley, Head of Equity Release, comments:

“The pre-retired’s are increasingly considering a release of property equity – not just to fund their retirement but also to overcome problems with getting a mortgage. As they investigate this option many of them find it can really work for them.”

To find out more about the Equity Release process click here

Content correct at time of publication

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