The number of equity release plans taken out by homeowners in May was also 10% higher than the previous month.
The total amount of equity released by homeowners was up 5.8% in May compared to April 2018, equity release providerResponsible Equity Release has found.
The number of equity release plans taken out by homeowners in May was also 10% higher than the previous month.
Although the amount of equity release continues to climb and the number of completed plans has risen, the average amount of equity released by homeowners fell slightly in May, down 4.1% on April to £72,877.
Steve Wilkie, managing director, Responsible Equity Release, said: “The equity release market is proving extremely resilient to economic and housing market conditions.
“The number of homeowners taking out plans and the total amount of equity released were both up in May.
“Although the average amount of equity released by individuals has fallen slightly, particularly in London, we have seen an increase in the amount of equity in reserve which can be tapped into if and when needed.”
The average amount released by individual homeowners reached a high of £87,035 in January and has fallen every month since. This is likely to be market-led; a reaction to the current economic landscape and homeowners taking more caution over financial decisions.
However, the equity release market is still proving extremely resilient in the face of growing Brexit fears and a stuttering property market in London.
Regionally, Yorkshire and the Humber saw the biggest increase in the amount of equity released by individual homeowners, up 27.4% in May to £50,575, compared to £39,688 in the previous month.
Londoners released substantially less equity from their homes in May, almost a third less than the amount released in April.
This is likely to be a reaction to the downward pressure on house prices in the capital, which has been the case for a few months now and could continue for some time yet.
Wilkie added: “Not surprisingly, the amount of equity London homeowners are taking out has fallen, but this illustrates how much the product has matured and how people view equity release.
“It is not a product to be used recklessly or in haste and instead provides a valuable financial solution. We spend a lot of time with homeowners assessing their needs to see if equity release is the right product for them. It is not for everyone.
“However, with a greater range of flexible products available to a wider audience, equity release now offers a genuine retirement income solution, and a financial buffer in the face of poor performing savings accounts and investments.”
