Equity release once suffered from something of a stigma but today, with more of us living longer and wanting to enjoy our retirements, it’s slowly becoming the rule rather than the exception. As such, the equity release customer doesn’t necessarily look as you would traditionally assume anymore.
In 2008, when the UK faced one of the bleakest recessions in memory, the average age of an equity release customer was 68-years-old. However, that climbed up to 71-years-old between 2016 and 2020 before falling to 70-years-old in 2021 as the country faced the COVID-19 pandemic.
According to a new 20-year survey by the equity release specialists Key, there have been over 557,000 equity release plans taken out since the year 2000, equaling more than £32.6 billion. This equity is used for several reasons – to pay off debts, help out a family member, go on a holiday of a lifetime or simply fund a more relaxed retirement.
The survey also found that:-
- Single women are typically twice as likely as single men to take out equity release. There is no exact data on why this is, though it might be simply because older single men are more likely to have work pensions to draw from.
- The average single female who took out equity release in 2020 was aged 69 while the average single man was aged 68. There’s literally a year in it there and given that females tend to live longer than males these numbers are not particularly surprising.
- Single females taking out equity release has increased over the past 10 years whilst single males taking it out has fluctuated.
- In 2021, the average value of homes used for equity release was £366,660, compared to £195,479 in 2021.
- The average loan to value dipped to its lowest in 2021 at 16% and peaked in 2014 at 29% but has stabilized this year at 25%.
- The difference between the average UK house price and the value of homes with released equity is at just under 58% in 2021.
- 59% of equity release customers are ‘joint life’ or partners.
Still, however, 41% of equity release customers are single, which goes against the narrative of equity release being for old couples who want to enjoy their retirement together. Sometimes, equity release can be a matter of necessity.
The general consensus today is that many people now approaching retirement are going to be equity rich and cash poor, which makes them ideal candidates for equity release. Of course, given the current state of the housing market and how few millennial’s own their homes, this could all change completely 30 years in the future. But for now, it’s a very good time indeed to release your equity!
Also read: Buying A Savings Plan is as Simple as A Few Clicks! Know More Here
The post What does the Average Equity Release Customer Look Like? appeared first on Gud Story.
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