Retirement savings: Equity release allowing over-55s to unlock over 100 weeks’ worth of pay from their properties, offering alternative funding for their later years
Over-55s using equity release products in the second half of last year unlocked over 100 weeks' worth of pay from their property, according to a report out today.
The research by the Equity Release Council discovered that customers using drawdown mortgage products in the last six months of 2015 withdrew an average of £49,607, which is equivalent to 109 weeks of the average worker's pay.
Meanwhile, those using lump sum mortgages pocketed £81,324 on average, which is 179 weeks pay.
For those with property in London, the average figures withdrawn rise to £72,858 through drawdown products and £209,739 through lump sum.
The total value of lending through equity release hit £898m in the latter half of 2015, up from £710m in the first half of the year.
"Equity release products continue to prove versatile in helping customers meet a range of financial needs before, at and during retirement," said Nigel Waterson, chairman of the Equity Release Council. "As a result, there is growing recognition from UK consumers, regulators and politicians that housing wealth can – and should – play a greater role in financial planning for retirement."
Simon Chalk, equity release expert at Age Partnership, added: "In 2015, we saw a rise of 68 per cent in interest-only borrowers turning to equity release as a solution for their debt from the previous year. But for those simply looking to supplement their income, pay for care, or perhaps need a one-off sum, equity release could offer an alternative way to capitalise on housing wealth without the need to downsize."