Equity release market estimated at £361bn

Equity release market estimated at £361bn

The latest research from Retirement Advantage has found that over 55s have access to an equity release market estimated at £361bn.

The findings come as the Equity Release Council reports that equity release lending reached a new high of £1.61bn in 2015, surpassing the former £1.21bn peak achieved in 2007 by 33%.

Alice Watson, product and communications manager at Retirement Advantage Equity Release, said: “The latest lending figures from the ERC confirm that equity release is increasingly becoming an integral part of retirement planning in the UK. The market is growing rapidly, but clearly still has a way to go, with less than one per cent of housing wealth available to over 55s being accessed through equity release.

As an industry, we have plenty of work to do to ensure that retirees understand all the options available to them. For many, their home will be their most valuable asset, and we should encourage them to understand that they can access the wealth stored in their homes without having to sell up.”

The research also shows that while most housing wealth per home is still available in the South of England, regions outside the traditional equity release heartland are catching up fast. Property values grew faster in the North of England and East Anglia than the South East over the last year.  
    
The South East tops the regional list for potential equity release value available to over 55s in Q4 2015, with a total of £76bn, followed by Greater London, where an estimated £57bn is available. Greater London saw the fastest annual growth in property value, up 16.8%, while East Anglia and the North, up 16.7% and 14.5% respectively, both saw more substantial increases than the South East, up 9.9%. The greatest quarterly increase in house price growth was reported in the North, at 6.6%, compared to 3.5% in London. 


Alice Watson commented: “With housing wealth among over 55s continuing to rise rapidly in the UK, we expect to see retirees taking an increasingly holistic approach to retirement. The regional distribution of this house price growth demonstrates that it’s not just in London and the South East where property can help to secure a comfortable retirement. House price growth is accelerating throughout the UK, with the North of England and East Anglia in particular reporting substantial increases in property wealth.

As the ERC looks to celebrate the 25th anniversary of its first industry standards, we welcome the Council’s efforts to build on the policy recommendations it made in October last year. Protecting borrowers and upholding best practice across the equity release sector is integral to ensuring its continued growth.”

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Latest Comments

MBM Homelets
MBM Homelets 23 Mar 2017

Although this is a very positive step, there is little or no guarantee of the standard of workmanship employed by the tenants. We have had experience of a professionally decorated property being ' painted'...

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ajay
ajay 21 Mar 2017

How is the "robust evidence" looking now?

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NathanG
NathanG 20 Mar 2017

I've been watching the series so far and am completely baffled by the cases that were presented. Though, I don't think that we can protect ourselves from every scam possible - it will just make the scammers...

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Landlady14
Landlady14 01 Mar 2017

You would think so Niraj Shah! My experience only proves that there are varying qualitiers of professional in all aspects of property letting. None of the ones I have dealt with, from letting agents to...

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Mark
Mark 01 Mar 2017

Thanks for this article. Hopefully one day everybody's lifestyle will be eco-sustainable.

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Ben Taylor
Ben Taylor 28 Feb 2017

I was convinced that London was the most expensive!

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Alan Read
Alan Read 28 Feb 2017

Australia are leading the way in this I think. The trouble with Britain is we don't get enough sun to make use of solar power.

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James Powell
James Powell 27 Feb 2017

This is a very good news.

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DanHumphreys
DanHumphreys 27 Feb 2017

It sounds like a good idea. Anything to help the younger generation get a foothold.

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Matt
Matt 20 Feb 2017

Is this fake news?

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Matthew Hollywood
Matthew Hollywood 07 Feb 2017

Matthew Hollywood - Director Mishon Mackay Land & New Homes - Brighton The shortage of New Homes is in part effected by the lack of land sales. Land sales are held back because there is a disparity between...

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CommercialTrust
CommercialTrust 30 Jan 2017

Hi Graham, Would be interesting to see the above figure calculated against an investment via a Lt Company /SPV structure and if the investor found themselves pushed in to the higher tax bracket. Mortgage...

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