Data suggests that confidence is growing among new and existing equity release customers.
Equity release customers rose by 12% in Q2 of this year, with total lending increasing by 15% to £578m1. There was also a quarterly and annual increase in the average loan size, which indicates that customer confidence is being restored.
More taking control of their loans
Data indicates that lifetime mortgage holders are proactively managing their equity release loans, with over 360,000 equity release customers making voluntary penalty-free partial repayments in 2022 and 2023. This will save them almost £300m in borrowing costs over the next 20 years.
Larger repayments
The total value of voluntary repayments increased by 18% between 2022 and 2023 from £102m to £120m. Plus, the average repayment size grew by 30% – going up from £538 to £697, indicating that customers are making an effort to reduce their loan sizes and cut borrowing costs.
Market turning a corner?
Chair of the Equity Release Council, David Burrowes, commented, “The pick-up in activity between the first and second quarters is a welcome reversal of the downward trend seen one year ago. There is a long way to go to unlock the market’s full potential, but there are reassuring signs in these figures that we are turning the corner and acclimatising to this unfamiliar interest-rate environment after years of rock-bottom rates.”
Talk to us
Equity release is not right for everyone – it is essential that you seek professional advice before taking out a lifetime mortgage. We can talk you through the advantages and potential drawbacks.
1ERC, 2024
Think carefully before securing other debts against your home. Equity released from your home will be secured against it.
