The equity release specialist looked at the thousands of equity release plans that it arranged in 2016 and compared the figures to 2015. More people than ever are taking out equity release plans with a 28% rise in the number of homeowners releasing equity from their properties last year.
Regional figures revealed that the number of equity release plans taken out in Scotland was up by 53.6% in 2016 versus 2015. The number of homeowners releasing equity was also up significantly in London (45.7%) the South West (32.7%) and East of England (32.2%) last year.
Homeowners in the East of England released on average over £12,000 more equity from their properties in 2016 than they did in 2015, with the average amount of equity released just under £54,000 (£53,680) compared to £41,378 the previous year.
Not surprisingly, London homeowners released the most equity from their homes in 2016, with an average loan size of £123,000 (£122,678), up 13% on 2015. Average size of equity release plans in the South East were £65,870, with individual homeowners in Northern Ireland releasing the least amount of equity (£32,725) from their properties.
The top reasons why people are releasing equity from their homes include paying off mortgages, helping with everyday living expenses and making improvements to the home. According to Responsible Equity Release, 36% to took out plans to clear mortgages, 28% to provide a cash cushion, 23% for home improvements, 7% to clear outstanding debts and 4% as an early inheritance.
Steve Wilkie, managing director, Responsible Equity Release, comments: "The equity release market had a record 2016. The industry has innovated to appeal to a wider audience and more homeowners are using the equity in their homes for a host of reasons, from supplementing their retirement income, to providing lump sums to pay off mortgages and clearing debts.
Equity release has provided an invaluable lifeline for thousands of pensioners who have found that their pension income is not sufficient to fund their retirements.
The equity release industry has also been far more receptive to innovation, recognising the importance of meeting the changing demands of customers who are more aware of equity release but want more choice and flexibility. The greater variety of products, such as interest-only lifetime mortgages and flexible repayment, has attracted a whole new market to the benefits of equity release.”
