Equity Release Council's Q3 2024 market report highlights key market trends
New equity release plans and total lending both grew in the third quarter of 2024, marking the first consecutive quarter of growth in two years, the Equity Release Council has reported.
The Equity Release Council’s Q3 2024 market report revealed that homeowners aged 55 and over withdrew £615 million in property wealth between July and September, a 6% rise from Q2.
The number of new plans agreed also grew by 2%, reaching 5,370. This period marks the first time since the Autumn 2022 mini budget that the equity release market has experienced back-to-back quarterly growth.
Average loan amounts rose slightly. New lump sum lifetime mortgage customers borrowed £111,618 on average, while those opting for drawdown lifetime mortgages withdrew £69,952 upfront and reserved an additional £49,747 for future use.
The report also highlighted an 8% increase in further advances from existing customers, indicating that many homeowners still have substantial equity available. This trend has been supported by six consecutive months of year-on-year house price growth since February 2024, according to the UK House Price Index.
David Burrowes (pictured), chair of the Equity Release Council, noted that the market’s recovery, while modest, is a positive sign.
“It’s encouraging to see growth continue during this transitional period following the new government’s arrival in July and ahead of its first Budget later this month,” Burrowes said.
He added that consumer confidence is gradually returning, although future growth may not be uninterrupted. He also highlighted the role of housing wealth in financial planning, with common motivations for equity release including mortgage refinancing, gifting, and home improvements, alongside boosting retirement income.
“As we head towards the end of the year, we anticipate that we will continue to see steady growth if interest rates remain stable and consumer confidence responds positively to the forthcoming Budget,” Burrowes said.
Lorna Shah, managing director of Legal & General Retail Retirement, also commented on the Equity Release Council’s latest market statistics, highlighting the market’s improving strength.
“The latest data points to a stronger later life market with growth over two successive quarters for the first time in two years,” Shah said. “The motivation to draw on property wealth is driven by a variety of factors and is constantly evolving.
“Legal & General data over the last year revealed a decrease in the number of customers using their property wealth to cover living costs and emergency funds, with a growing trend of people using their property wealth to pay off mortgages or other forms of debt, for instance.”
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