"The gradual recovery suggests people are carefully weighing up their circumstances and long-term needs, helped by specialist financial and legal advice"
20,352 new and returning customers accessed property wealth between April and June, edging closer to pre-pandemic activity levels, according to the latest data from the Equity Release Council.
The latest figure compares with an average of 21,036 customers served per quarter in 2018 and 2019.
Homeowners unlocked £1.17bn of property wealth in total during Q2 2021, up 2% from Q1 and up 67% since a subdued Q2 last year during the first Covid-19 lockdown.
Drawdown lifetime mortgages remained the most common type of new plan agreed (55%), although more customers took out lump sums in June before the £500,000 stamp duty holiday ended.
Q2 saw 9,382 existing customers with drawdown lifetime mortgages return to make a withdrawal from their agreed reserves. This was up from 5,566 in Q1 and 5,608 in Q2 2020.
This marked a return to near pre-pandemic levels of activity in this part of the market, with returning drawdown numbers having been subdued for most of the last year as existing customers paused extra withdrawals.
David Burrowes, chairman of the Equity Release Council, commented: “Judging by these latest figures, the equity release market is showing signs of stability and durability as the option to access property wealth opens doors for thousands of people to pursue their financial goals.
“We were accustomed to more than 20,000 new or returning customers releasing equity each quarter in the two years before Covid-19 struck. We’re now seeing activity levels steadily returning back to that status quo, with some existing customers returning to make withdrawals that were put on hold last year. The gradual recovery suggests people are carefully weighing up their circumstances and long-term needs, helped by specialist financial and legal advice, with speculation about a spike of activity during the pandemic so far proving unfounded.
“The steady recovery has been helped by confidence in the wider property market, where house price gains over the last year have given many homeowners more equity at their disposal. Equity release has become a socially important means for one generation to help another, as well as meeting later life financial needs. June’s stamp duty deadline will have prompted some older homeowners to pass on a ‘living inheritance’ so that younger family members can climb the property ladder.”