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Is this why transactions have slumped? Equity Release hits a new high...

Only 24 hours after the Land registry released data showing a 20 per cent slump in housing transactions, new figures from the Equity Release Council throw some light on why older owners may no longer be moving house so frequently.

The data shows that the equity release market is moving closer to the psychologically-important threshold of £1 billion of activity in a single quarter.

Owners aged 55-plus unlocked a record £971m from their homes in the second quarter of this year, between April and June.


Lending in the period increased by 12 per cent compared with the first quarter of 2018 - when £870m was lent - and by 39 per cent year-on-year from the second quarter of 2017. 

This latest quarterly increase was broadly in line with the average 11 per cent growth seen from quarter to quarter since Q1 2016 - the Equity Release Council says this shows that ER “has taken up a position as a mainstream financial solution in later life.”

Total lending in the first half of 2018 reached £1.84 billion overall, up by 32% from H1 2017.

The total number of customers served increased by 28 per cent over the same period from 16,805 to 38,912.

The data suggests the rise in activity during Q2 this year was driven by 11,295 customers taking out new plans, compared with 10,195 in the previous quarter and 8,454 a year earlier. 

More than three in five new customers chose drawdown lifetime mortgages, which gives them access to equity from their homes in multiple instalments; the remaining borrowers chose a lump sum mortgage to receive a single payout instead.

The average first instalment of a drawdown plan was £63,584 in the second quarter of this year, while the average new lump sum plan was £95,991.

“Consumers are releasing money from their homes for a variety of reasons, and features like downsizing protection and repayment options mean today’s equity release product range is designed to evolve as people age and circumstances change” says David Burrowes, chairman of the Equity Release Council.

Poll: There are fewer older homeowners downsizing, because of Equity Release


  • icon

    I love all the euphenisms around "equity release". Equity release is just DEBT. Just more debt which a homeowner takes on secured against a property. Nothing is "released" - people using this are just borrowing more money.

  • Brit Miller

    This will slow down as house price falls spread to rest of the country, slowing down further as interest rates go up putting more downward preasures on house prices.


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