Recent data has revealed that homeowners have released around 50% more equity from their homes during the last quarter.
Figures from Responsible Equity Release indicate that following a drop in house sales over summer, there has been an increase of 49.6% in cash unlocked through property in comparison to Q2.
Parallel to the rise in equity released, the number of homeowners who chose to boost their funds in this way also saw an increase. During the most recent quarter, the number of people who released equity rose by 28.4%; 86.6% greater than the same period last year.
On a regional basis in August, the North West saw a 102.3% monthly growth in the amount of cash unlocked, with a rise of 55.3% in the East of England.
At the other end of the spectrum, London saw a fall in the total amount of equity released last month, with a month on month drop of 17.2%. On average, the amount released stood at £174,489. This drop has largely been attributed to the slowdown in the London housing market, which has significantly cooled during recent months.
Commenting on the figures was Stevie Wilkie. The managing director at Responsible Equity Release stated: “The Bank of England has indicated that an interest rate rise is on the horizon, but a small increase in the base rate is unlikely to help Britain’s retirees who have suffered more than most during the past eight years of record low rates.
“Whether rates will rise in the near future is anyone’s guess, and many people have decided there’s no point in waiting for that day. Instead, they have taken matters into their own hands and are using their one major asset, their property, to boost flagging income.
“The Government seems to have forgotten the millions of retirees when it comes to its monetary policy, and equity release has stepped up and proven a financial lifesaver. It has provided a viable and much-needed income stream, where savings and investments have failed to do so.
“In particular, we have noticed how popular the drawdown option has become. Britain’s retirees aren’t about to blow all their money on holidays and sports cars, but knowing that they have an income tap facility in place that can be turned on when required is reassuring.”
