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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daniel black
daniel black 25 Oct 2016

I've been keeping a close eye on what the effect of Brexit has been on the rental market and it's a very mixed bag. Whilst the majority of the news focuses on London's market. I think this time next year...

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Northerner 20 Oct 2016

Any views from outside the M25? No wonder politicians can't get the housing big picture when everyone seems to think that London is the yard stick, when it absolutely is not.

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Sean Lees 13 Oct 2016

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Please Sian Berry Dan Wilson Craw LANDLORDS DO NOT WANT TO RAISE RENTS They are being forced to because of Section 24! An unfair, punitive tax hike that will be a disaster Green Party, Generstion...

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Absolutely agree! Moreover property prices edged up with 0.7% this month as the market recovered from the initial Brexit hit

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Gary Das
Gary Das 06 Oct 2016

A lot of lenders (especially the high-street banks and lenders people approach first) could do more to accommodate for the self-employed. It can really be a struggle, as I found out myself last year when...

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Not sure I understand this! If Basildon and Hemel rose 68% and 52% respectively, why do they not appear in the top ten list, which appears only to feature those in the minus 20's!! Is it me?

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luxus 27 Sep 2016

It can be stressful. More clarity is needed on the process, from a customer perspective and consideration should be given to using the Scandinavian model where the sales process is much quicker.

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Green belts are normally designated around capitals and other major cities and conurbations and their aim is to prevent urban sprawl by keeping land permanently open. The essential characteristics of green...

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