Home improvements and clearing mortgages top reasons for using equity release so far in 2017
The most popular reasons for choosing equity release during the first half of 2017 are making home and garden improvements and clearing existing mortgages, according to new findings from Retirement Advantage. The figures also reveal a long and diverse list of reasons for releasing the money, including going on holiday, buying cars and contributing towards daily living expenses.
Based on data from their own customers, Retirement Advantage finds that over one in four (27%) have taken out an equity release loan so far in 2017 to make home and garden improvements and to clear an existing mortgage. These are the most popular reasons cited. Third most popular is consolidating unsecured debts, cited by 18% of customers.
Alice Watson, Head of Marketing at Retirement Advantage Equity Release, commented:
“As equity release grows rapidly, customers are finding they can use it for a diverse range of reasons. This bodes extremely well for the future, as property wealth establishes itself firmly as part of retirement planning alongside pensions and other assets.
“The popularity of using equity release to clear an existing mortgage is a trend we’ve noticed before among our customers, and speaks of some of the particular features in our product range.”
Retirement Advantage’s data also reveals that customers are choosing equity release for many other reasons. 14% are using it to contribute to daily living expenses, while 13% of customers in 2017 have used equity release to fund a holiday. Other reasons cited by customers so far this year include gifting to family (9%), buying a new car (9%) and even purchasing a new property (7%).
Alice Watson added:
“It’s always fascinating to see the breadth of uses customers have for the funds they unlock from their properties. It is encouraging evidence that retirees are thinking holistically about the role of property wealth alongside other assets to live the lives they want. Especially as evidence suggests that for many, their property will be worth more than their pension.
“As advisers discuss retirement with clients, these figures should serve as a useful reminder that wealth sat in properties can be used to support just about every aspect of their lives as they plan for and enter retirement.”