UK property becoming increasingly important part of retirement planning

Taylor Scott International News

Property is becoming an increasingly important part of retirement planning in the UK with new figures showing a surge in the number of retirees using the wealth stored in their home to fund their retirement. The total value of equity release lending passed £1 billion in the first nine months of 2014 and reached a record quarterly amount in the third quarter of £375.5 million, according to the latest industry figures from the Equity Release Council. The data also shows that there were more than 5,500 new customers in the third quarter of the year, the most recorded in a single quarter for six years and the average amount of equity release lending also hit a new high. The amount lent for the first three quarter of 2014 at £1.02 billion is more than the entire year's lending totals for 2009 to 2012 and is already 95% of the total value of the market in 2013. The value of equity release lending in the third quarter was up by 15% on the previous quarter when it totalled £325.6 million, and up 32% year on year from £284.1 million in the third quarter of 2013. The 5,565 new customers in the third quarter of 2014 is the largest amount in a single quarter for almost six years when it reached 7,526 in the fourth quarter of 2008, a rise of 5% on the second quarter of 2014 and a 12% year on year increase. This brings the number of new customers to 15,624 in 2014 to date, putting the industry on track to see 20,000 new customers in total by the end of the year. The average value of equity release lending also broke new ground in the third quarter of 2014 by reaching £67,467, the largest amount on record and up by 9% since last quarter and up by 18% since the third quarter of 2013. The council said that the growth is being driven by the need for additional funds in retirement and by the boost that rising house prices have given to people's available equity. Lump sum and drawdown lifetime mortgages have continued their upward climb, with increases for both products in the third quarter of 2014. The value of lending via lump sum products rose 16% from the last quarter to £148.7 million while the value of drawdown lending rose by 15% to £225.7 million, demonstrating largely even growth across both product options. Lump sum plans accounted for 40% of the total market by value in the third quarter of 2014, while drawdown plans made up 60%. In contrast, for the same period last year 34% of equity release lending was via lump sum plans and 66% was drawdown. The council pointed out that this is a notable shift, potentially fuelled by the appeal of larger initial sums that allow customers to pay off lingering debts, such as outstanding mortgages, or to fund one-off expenses. While making up less than 1% of the market, home… Taylor Scott International

Taylor Scott International, Taylor Scott

This entry was posted in Investment, investments, London, News, Property, Real Estate, Shows, Taylor Scott International, TSI, Uk and tagged , , , , , , , , , . Bookmark the permalink.