The Latest Equity Release Industry Statistics Explained
The average amount of equity released in H1 2021 has risen to £103,710 from £96,600 in H1 2020.
The statistic indicates that in the first half of 2021, the average amount of equity released by individuals has increased to £103,710 from £96,600 in the same period of 2020. This rise of £7,110 represents a positive trend in the amount of equity released, suggesting that homeowners are accessing more cash from their homes in 2021 compared to the previous year. This increase may be attributed to various factors such as rising property values, economic conditions, and changing attitudes towards equity release products. It demonstrates a potential shift in financial behavior and decision-making among homeowners in utilizing the equity in their properties for various purposes.
The number of new plans taken out fell by 10% in H1 2021 to 33,565 from 37,394 in H1 2020.
The statistic states that there was a 10% decrease in the number of new plans taken out in the first half of 2021 compared to the same period in 2020. Specifically, the number of new plans decreased from 37,394 in the first half of 2020 to 33,565 in the first half of 2021. This decline indicates a reduction in the demand or uptake of these plans during the specified time frame. The decrease could be attributed to various factors such as changes in market conditions, economic uncertainties, shifts in consumer behavior, or other external influences impacting individuals’ decisions to take out new plans.
In 2020, the total lifetime mortgage advances in the UK reached £3.89 billion.
The statistic states that in 2020, the total lifetime mortgage advances in the UK amounted to £3.89 billion. Lifetime mortgages are a type of equity release product where homeowners can access some of the value tied up in their property while still living in it. This figure indicates the total amount of money borrowed through lifetime mortgages in the UK during that year, reflecting a significant level of financial activity in the housing market. It suggests that a considerable number of homeowners utilized this type of financial product to access funds, potentially for reasons such as funding retirement, home renovations, or other financial needs.
The number of homeowners aged 55 and over using equity release to clear mortgage debts rose by 29% in 2020.
The statistic indicates that in the year 2020, there was a significant increase of 29% in the number of individuals aged 55 and over who utilized the financial option of equity release to pay off their mortgage debts. Equity release refers to a financial arrangement that allows homeowners to access the equity tied up in their property while still residing in it. The rise in this practice among older homeowners suggests that more individuals in this demographic are facing challenges in meeting their mortgage obligations and are turning to equity release as a means of managing their financial situations. This statistic highlights a trend towards leveraging home equity as a tool for debt management and financial stability among older homeowners.
In 2020, nearly one in five (19%) equity release customers used some or all the money to clear existing mortgages.
The statistic provided indicates that in 2020, approximately 19% of customers who utilized equity release used the funds to pay off existing mortgages. Equity release is a financial product that allows homeowners to access some of the value tied up in their homes without having to sell the property. Clearing existing mortgages with funds from equity release can help these homeowners eliminate monthly mortgage payments, reduce debt load, and potentially improve their overall financial situation. This statistic suggests that a significant minority of equity release customers are choosing to use the funds to address their mortgage obligations, indicating a trend towards debt repayment or consolidation among this group of individuals in 2020.
In 2020, 38 percent of equity release customers used some of the funds to make home and garden improvements.
The statistic, “In 2020, 38 percent of equity release customers used some of the funds to make home and garden improvements,” indicates that out of all the customers who utilized equity release in 2020, 38 percent of them chose to allocate a portion of the released funds towards enhancing their properties. This data suggests that a considerable number of individuals who engage in equity release transactions prioritize investing in their homes and outdoor spaces. Home and garden improvements are typically considered long-term investments that can potentially increase the value of one’s property. Therefore, this statistic highlights a trend among equity release customers towards utilizing the released funds to enhance the aesthetic appeal, functionality, and value of their residential properties.
Equity release customers in 2020 were more likely to spend some of their funds on gifts for family or friends (13%) compared to 2019 (9%).
The statistic indicates that in 2020, a higher proportion of customers who utilized equity release facilities chose to allocate some of their funds towards purchasing gifts for their family or friends, with 13% of customers doing so compared to 9% in 2019. This suggests a potential shift in spending behavior among equity release customers, possibly driven by external factors such as economic conditions, social trends, or changes in personal priorities. The increase in the percentage of customers spending on gifts may reflect a desire to support loved ones or enhance their quality of life, highlighting the varied ways in which individuals utilize equity release funds beyond traditional expenditures. Understanding these changing patterns can provide valuable insights into consumer behavior and preferences within the equity release market.
The average equity release interest rate for new customers was 4.35% in July 2021 – lower than the preceding six months’ average
The statistic indicates that in July 2021, the average equity release interest rate for new customers was 4.35%, which was lower than the average rate observed in the previous six months. This suggests that there was a downward trend in equity release interest rates during this period. A lower interest rate can benefit new customers seeking equity release, as it means they would pay less in interest over the life of their loan. This could potentially make equity release a more attractive option for individuals looking to access the equity in their homes. Additionally, a decreasing interest rate environment can also indicate broader economic trends that may be influencing the cost of borrowing.
The average age of a new equity release customer has fallen from 71.6 in H1 2020 to 70.7 in H1 2021.
The statistic indicates that the average age of individuals obtaining equity release, a financial product that allows older homeowners to access the equity in their homes, has decreased over the specified period. In the first half of 2020, the average age of new equity release customers was 71.6 years, while in the first half of 2021, this average age has slightly decreased to 70.7 years. This trend suggests that a slightly younger demographic is now opting for equity release as a means to access funds, potentially reflecting changes in financial circumstances, attitudes towards inheritance, or other factors influencing the decision-making process of older homeowners.
Switching to a new equity release plan saved customers an average of £14,053 in the first half of 2021.
This statistic indicates that customers who switched to a new equity release plan in the first half of 2021 were able to save an average of £14,053 compared to their previous plan. Equity release allows homeowners to access the value tied up in their property, typically for retirement income or to fund big expenses. By switching to a new plan, these customers were able to secure a more favorable deal with lower fees, interest rates, or enhanced benefits, resulting in significant savings. This suggests that shopping around and comparing different equity release options can potentially lead to substantial financial gains for individuals looking to leverage their home equity.
Property wealth totalled £6bn of equity being released across 76,154 new plans agreed in 2020.
In 2020, a total of £6 billion worth of property wealth was unlocked through equity release, with 76,154 new plans being agreed upon. Equity release refers to a financial product that allows older homeowners to access the value tied up in their properties without having to move. This statistic indicates a significant level of activity in the equity release market in 2020, with a substantial amount of property wealth being accessed by individuals looking to supplement their income, fund retirement, or meet other financial needs. The large number of new plans agreed upon suggests a growing interest in this financial solution among property owners.
A total of £1.05 billion was unlocked from the value of homes in Q2 2021, up 17% from Q1
In the second quarter of 2021, a total of £1.05 billion was released from the value of homes through various equity release schemes, representing a significant 17% increase from the previous quarter. This statistic indicates a growing trend of homeowners accessing the equity built up in their properties to supplement their finances. The increase in the amount unlocked suggests a rising demand for equity release products, potentially driven by economic uncertainty or changing lifestyle needs among homeowners. Overall, the data reflects a notable growth in the utilization of housing wealth to support individuals’ financial objectives during the specified period.
The total number of new customers entering the market in Q2 2021 was up 19% on the previous quarter, at just over 20,000.
The statistic indicates that the total number of new customers entering the market in the second quarter of 2021 increased by 19% compared to the previous quarter. Specifically, there were just over 20,000 new customers who entered the market during Q2 2021. This implies a notable growth in customer acquisition for the company or industry being studied, highlighting a strengthening market demand or successful marketing strategies. The increase in new customers suggests a positive trend in business performance and potential opportunities for further growth and expansion in the future.
Conclusion
The equity release industry statistics highlight the growing popularity and importance of this financial product for older homeowners looking to unlock funds from their property. With a steady increase in the number of equity release plans and the total amount released, it is evident that more individuals are recognizing the benefits and flexibility that equity release can offer. These statistics provide valuable insights into the current state and future trends of the equity release market, underscoring the need for continued monitoring and research in this evolving sector.
References
0. – https://www.moneyfacts.co.uk
1. – https://www.www.moneyfacts.co.uk
2. – https://www.www.propertyreporter.co.uk
3. – https://www.www.mortgagestrategy.co.uk
4. – https://www.www.equityreleasecouncil.com
