The equity release market saw a record start to the year with eight per cent more cash released and customer numbers up 10 per cent, according to quarterly data from trade body the Equity Release Council.
In the first three months of the year, £936m of property wealth was unlocked by 20,397 customers, including 10,854 who agreed new plans.
This was the highest first quarter activity since records began in 1991 following significant growth since 2015, with the value of equity released almost trebling.
The Q1 figures follow a breakthrough year in 2018 where more than 80,000 homeowners aged 55 or over accessed £3.94bn of property wealth, with Q4 2018 the busiest quarter on record.
The average new lump sum lifetime mortgage agreed in Q1 2019 was £97,763, with draw down customers taking a first instalment of £62,416 on average.
The majority, or 64% of customers took out draw down products, which allow customers to take cash when needed, while 36% chose a lump sum lifetime mortgage, with most taking cash for home improvements, boosting retirement income and helping family and friends.
Older borrowers over 75 were often funding property adaptations or care needs and younger 55 to 64-year olds were often paying off mortgages and unsecured debt.
David Burrowes, chairman of the Equity Release Council, said: “The recent addition of regular income-paying products has added to a varied product range offering monthly interest payments, ad-hoc lump sum repayments, downsizing protection and inheritance guarantees.
“As a result, housing wealth is playing an increasing role in supporting the nation’s later life finances.”
Only 8 per cent higher
Alice Watson, head of marketing and communications at Canada Life Home Finance, said: “It’s a very welcome sign that equity release continues to scale new heights, with the sector registering record first quarter lending for the sixth year in a row.
“However, the amount lent in Q1 2019 is only 8 per cent higher than for the same period last year, a much lower rate of growth compared with the high double-digit increases we’ve seen in more recent quarters. This is a timely reminder that the industry shouldn’t rest on its laurels.”
Equity release specialist broker, Equity Release Supermarket also reported a record start to the year today, with 31% growth in the first quarter, which it said was partly driven by a new website.
Mark Gregory, founder and CEO said: “With the exception of London we have seen strong growth across all the regions.”