A new report, conducted by the Centre for Economics and Business Research for the financial services group Legal & General, claims almost 450,000 first time buyers could get on the property ladder this year if older owners released capital from their homes.
The report suggests that this year some three per cent of home owners over 55 have taken out an equity release lifetime mortgage - a figure unchanged from last year.
But L&G says that if far more over-55s adopted this strategy, they could help 442,900 individuals buy a home this year.
Citing Office for National Statistics data, the research says that over the past 20 years house prices have increased by 259 per cent with wages rising only 68 per cent. “By freeing up capital that is tied into a family home, individuals will have the opportunity to support family members or friends onto or up the property ladder” urges L&G.
However, the CEBR report suggests this is unlikely to happen in the short term as a significant majority of over 55s - some 59 per cent - say they do not need the extra cash that equity release would offer.
“Releasing equity from a family home has the potential to play a role in tackling our housing market’s affordability crisis. By releasing equity using a lifetime mortgage, parents and grandparents have the opportunity to help their loved ones onto the property ladder” says an L&G spokesman.