"The equity release market is following a steady course, albeit at a lower level than was the pre-Covid norm."
Additionally, overall customer numbers proved more resilient than during the first lockdown of Q2 2020, when just 13,617 new or returning customers withdrew equity from their properties.
New customer activity in Q1 2021 cooled slightly, driven by seasonal trends amplified by renewed Covid-19 restrictions, as the number of new plans edged down to 10,030 from 11,079 in Q1 2020.
With lockdown restrictions tightened, February 2021 saw the fewest new plans agreed since June 2020, before modest growth returned in March.
Q1 was the quietest start to a year for total customers served since Q2 2017, while the 5,566 returning drawdown customers was lower than at any point in the last four years.
David Burrowes, chairman of the Equity Release Council, commented: “Despite ongoing uncertainty over the trajectory of the pandemic, this latest data for the early months of 2021 shows how the equity release market is following a steady course, albeit at a lower level than was the pre-Covid norm. The market has proven to be robust and applied lessons learned in the first lockdown to maintain access to property wealth for those customers who need it, guided by multi-layered financial and legal advice.
“Decisions to release equity are not made in isolation of wider developments in the property market. The resilience of house prices means that, for many older homeowners, property continues to be the most significant asset at their disposal and a viable route to boosting their income from pensions and savings, or gifting a ‘living inheritance’ to family members for their own use such as for a house deposit.
“In the right circumstances, equity release is a flexible financial planning tool that can increase retirees’ options in later life. Property wealth has performed well even amid the economic disruption, and with the successful vaccination programme feeding through into consumer confidence, many people may be revisiting their financial priorities. It is vital to seek regulated financial advice and independent legal advice, ideally from Council members, to consider if equity release is right for you, or whether an alternative source of funds is more appropriate.”