"Bricks and mortar become many people’s single biggest financial asset when they reach later life."
Its research shows that the market experienced its busiest quarter of 2019 to date, both in terms of new plans agreed and total property wealth accessed by new and returning customers.
More than 11,419 new customers opted to release cash from their properties in Q3 – a 6% increase on the previous quarter - with almost £11 million of property wealth unlocked each day from July to September.
The three busiest quarters recorded for equity release activity have all come in the 15-month period between Q3 2018 and Q3 2019. However, average withdrawals have remained stable as the market has grown. The average first instalment of a drawdown plan was £63,222 in Q3 2019, compared to £64,793 two years ago, while the average lump sum plan was £95,557 vs. £100,389 in Q3 2017.
David Burrowes, chairman of the Equity Release Council, commented: “As a nation with an ageing population and a growing need to support longer lives, it is important not to overlook property wealth in modern retirement planning conversations. Today’s equity release market is offering new solutions to fund later life, by combining rigorous consumer protections with more product choices and flexibility to help people meet their financial needs and goals.
“The result of buying property and making mortgage payments during their working lives is that bricks and mortar become many people’s single biggest financial asset when they reach later life. Industry, regulators and government must continue to promote and encourage lifelong savings habits, while also recognising that retirement financial plans are best made by taking all assets into account.”
Alice Watson, head of marketing and communications at Canada Life Home Finance, added: “It’s great to see yet more expansion in the equity release market, with almost £1 billion of property wealth unlocked in the third quarter. This growth is especially positive given the wider political and economic malaise.
“With over 30,000 new customers taking out equity release this year, this is a real vote of confidence in the industry, and a sign that more people are viewing their wealth holistically. We think this is evidence that equity release is becoming an increasingly important tool in mainstream financial planning.
“Further market growth wouldn’t be possible without the kind of innovation that has continued to invigorate the industry, but the most successful products and services will continue to be those that meet customer demand."
