Q2 2022 EQUITY RELEASE MARKET REPORT

The Latest Equity Release Statistics! Is There Room for Improvement?
Contributors: Nicola Date, Katherine Read. Reviewed by Francis Hui
Do You Want to Know the Latest Equity Release Market Statistics for 2022? Find Out If Drawdown Lifetime Mortgages Are Still a Favourite Amongst Equity Release Customers & Why Q2 Saw a Strong Resurgence of Released Equity from New & Returning Customers. Get the Scoop Here!

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What You’ll Learn in This Article:

    Key Q1 2022 Equity Release Market Statistics

    The latest equity release market statistics are showing a strong resurgence in the sector.

    Plan popularity is at an all-time high as homeowners clammer to unlock cash from their highest-valued asset to fund retirement.

    We’ve got the full report right here!

    The Number of New & Returning Customers Reached a Quarterly High

    Between April and June 2021, 20,352 new and returning customers released equity from their homes.

    These figures are closer to pre-pandemic times, contrasting what was seen during the height of COVID-19.

    This had risen compared to the 16,527 in Q1 2021 and 13,617 in Q2 2020 when COVID-19 lockdown was at its peak.

    Drawdown Lifetime Mortgages Still a Favourite Amongst Equity Release Customers

    The most common type of equity release is still a drawdown lifetime mortgage, with 55% of customers opting for such plans.

    Lump Sums Still the Most Preferred Payout Option

    In June, lump sums1 were the most popular product, and many were unlocked before the £50,000 Stamp Duty2 holiday deadline.

    Q2 2021 Sees a Lot of Returning Customers Due to Strong Market Confidence

    2020 saw several plan holders pausing withdrawals due to the pandemic.

    However, the figure for returning customers picked up in Q2.

    667% Increase in Equity Released by Over 55s as Compared to Q2 2020 Figures

    This time last year, only £698m was unlocked by over 55s. In contrast, £1.7bn of equity was released in Q2 of 2021, a steep 67% more.

    These figures are rising as £1.14bn (2% less) was released in Q1 of 2021.

    Q2 2021 Equity Release New Customer Trends

    9,898 New Plans Signed in Q2 2021

    9,898 new equity release plans were signed in Q2 2021. This is slightly down from the 10,030 of the previous quarter.

    The average during COVID-19 has been 9,822, with the lowest being in Q2 of 2020 at 7,341, during the height of lockdown.

    3,348 Plans Agreed to in June 2021 Alone

    The most new plans in Q2 were agreed to in June, with this figure being 3,348.

    June 2021 Sees Lump Sum Plans Overtake Drawdown Plans as the Most Preferred Equity Release

    June was the first month in more than a year where more customers opted for lump sums instead of drawdowns.

    1,726 lump sum plans were unlocked, and 1621 drawdowns.

    This is likely linked to June’s £500,000 Stamp Duty holiday deadline, where older folks would be helping their families with moves before this time.

    First Instalments Decrease by 4% As Compared to Q1 2021

    On average, first instalments were at £86,349, 4% lower than the previous quarter. The figure in Q1 was £89,758.

    New Lump Sum Mortgages Reaches New Heights at £129,558

    New lump sum lifetime mortgages reached £129,558, 5% more than Q1.

    This figure is likely influences by a property value increase and the Stamp Duty holiday deadline.

    Q2 2021 Equity Release Existing Customer Trends

    9,382 Existing Customers Withdrew Funds From Their Drawdown Plans in Q2 2021

    9,382 existing customers withdrew from their drawdown plan’s agreed reserves in Q2 of 2021.

    This is a significant increase compared to the 5,566 in Q1 2021 and 5,608 in Q2 2020.

    35% Decrease in Returning Drawdown Customers Due to COVID-19

    The first 12 months of the pandemic saw just 24,663 returning drawdown customers.

    Current figures are indicative of how the market is recovering. Pre-COVID times saw 37,660 customers in 12 months.

    Q2 2021 Sees Increase in Plan Advances

    Between April and June 2021, further advances on plans were signed by 1,072 homeowners.

    This is a typical trend for COVID-19, as people are looking for more money to survive the pandemic.

    A Note From The Equity Release Council on The 2021 Equity Release Market Statistics

    According to David Burrowes, the Chairman of the Equity Release Council:

    “Judging by these latest figures, the equity release market is showing signs of stability and durability as the option to access property wealth opens doors for thousands of people to pursue their financial goals.

    “We were accustomed to more than 20,000 new or returning customers releasing equity each quarter in the two years before COVID-19 struck.

    We’re now seeing activity levels returning to that status quo3, with some existing customers returning to make withdrawals that were put on hold last year.

    The gradual recovery suggests people carefully weigh up their circumstances and long-term needs,

    Helped by specialist financial and legal advice, with speculation about a spike of activity during the pandemic so far proving unfounded.”

    “The steady recovery has been helped by confidence in the wider property market, where house price gains over the last year have given many homeowners more equity at their disposal.

    Equity release has become a socially important means for one generation to help another, as well as meeting later life financial needs.

    June’s Stamp Duty deadline will have prompted some older homeowners to pass on a ‘living inheritance’ so that younger family members can climb the property ladder.”

    Looking for more information on equity release market statistics and related equity release information?

    We have more equity release infographics.

    Common Questions

    How Many People in UK Have Taken Equity Release?

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    In Conclusion

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