With the cost of living squeezing household budgets, more and more people are looking to their homes to boost their finances.
The good news is that the equity release market is booming, with more people than ever before choosing to unlock the wealth tied up in their properties. This means you’re not alone if you’re considering using your home to support yourself in retirement!
More People Choosing Equity Release
New figures from the Equity Release Council show a 15% increase in total lending for equity release in the second quarter of 2024, reaching £578 million. This is the busiest quarter in almost a year for the market.
Who’s Using Equity Release?
The number of new customers using equity release products jumped by 12% in the second quarter compared to the previous three months. This means there are more people than ever before choosing to release some of the value in their homes.
Why the Increase?
Experts say this increase in activity is a sign that people are becoming more confident about their finances, despite the current economic uncertainty.
Popular Uses For Equity Release
There are lots of ways people are using equity release, including:
- Helping out loved ones: Gifting money to family and friends.
- Improving your home: Funding home improvements like a new kitchen or bathroom.
- Boosting your income: Using the money to top up your pension or cover everyday living expenses.
- Paying off existing debts: A lot of people are using equity release to pay off mortgages, especially interest-only mortgages which can become more expensive in retirement.
What About Drawdown Products?
Drawdown products are becoming increasingly popular. These allow you to take out money in smaller amounts as you need it, rather than all at once.
Experts Say…
David Burrowes, the chair of the Equity Release Council, says: “It’s great to see confidence returning to the market. People are realising they can use their property wealth to help them in their later years.”
He adds: “While there is still room for growth, the recent increase in activity is encouraging. It shows that people are adapting to the current economic environment.”
Key Takeaways:
- The equity release market is growing, with more people using it to access their property wealth.
- The most popular reasons for using equity release are gifting, home improvements, boosting income, and paying off debts.
- Drawdown products are becoming increasingly popular, offering greater flexibility to homeowners.
If you’re thinking about using equity release, it’s essential to talk to a qualified financial advisor to ensure you understand the risks and benefits.
Remember, equity release is a significant decision, so be sure to seek professional advice before you take any steps.