Housing wealth in UK reaches £446 million
3:06pm Thursday 30th August 2012
Retired homeowners are putting families first as sales of equity release plans and total lending soar, analysis from independent equity release adviser Key Retirement Solutions shows.
Thirty one per cent of pensioners used property wealth to help their families in the first six months of 2012 compared with 23 per cent in the same period of 2011 as the total value of housing wealth released soared to £446 million. Over the same period the numbers using property wealth to clear their own debts dropped to 25 per cent from 31 per cent.
Total lending in the first six months increased 15.7 per cent to £446.21 million from £385.68 million and would have topped £630 million if £185 million of untapped drawdown funds which have yet to be released are added in.
Dean Mirfin, group director at Key Retirement Solutions (www.keyrs.co.uk), said “Retired homeowners are putting families first as the recession continues to squeeze finances across generations.
“Helping out family is a powerful motivation for elderly homeowners and it is striking that they feel financially secure enough to help families before themselves and are under less financial pressure from their own debt.
“The equity release market is firmly back on the growth track with total values released up 15 per cent in the first half of the year while sales of plans are also well ahead of 2011.”
Home and garden improvements remained the most popular use of equity release cash – 58 per cent of customers used some or all of the cash for that with 30 per cent using money to fund holidays. Only 16 per cent used money to pay regular bills while 18 per cent used it to clear outstanding mortgages.
The biggest growth in values released was in London where total value increased by 45.3 per cent while the south east saw totals climb by 23.7 per cent.