Equity release continues to grow among UK homeowners in the UK with activity hitting more than £700m in the second quarter of the year, up 36% year-on-year, fresh figures reveal.
New data from the Equity Release Council shows that 8,454 new plans were agreed in Q2 2017, an increase of 27% compared with the corresponding period last year and the sector recorded activity from over 16,000 new or returning customers between April and June.
Drawdown plans remain the most popular product choice, accounting for 68% of all products taken out, while lump sum products accounted for 32% of new plans agreed, the Equity Release Council said.
The figures suggest that older customers are increasingly looking to use the wealth in their homes to help fund their retirement, which could include using the funds to invest in property.
Nigel Waterson, chairman of the Equity Release Council, commented: “Continued rapid growth in housing wealth withdrawals reflects an increasing appetite among older consumers to utilise bricks and mortar for funding retirements.
“The retirement income pressures facing many savers in the era of defined contribution pensions and low interest rates are encouraging home owners to consider a wider range of financial options."
Housing wealth is an important part of bridging the gap between the comfortable retirement people want and the retirement they can afford from their savings, according to Waterson.
He added: “It is vital we build on recent work by regulators and industry to encourage more joined-up thinking between related areas of financial services, so that consumers have the best support for their transition into later life.”