The equity release market has continued to thrive with new offers available and more interested parties realising the financial potential in their home as they reach retirement. However the market is rising faster with borrowers upsizing from smaller to bigger homes, according to Retirement Plus managing director, Duncan Young.
Young described the move from smaller to bigger home for retirees as ‘a phenomenon’, and claimed that as people retired, they were looking for nicer places to live in, and generally wanted a bigger garden. Reports also showed that two-thirds of borrowers would upsize their property when they retire with the intention of looking for a more expensive property to sell on, and subsequently leave more capital for their families.
Young said: “One instance involved a person who lived in Docklands and moved from one side of the building to the other in order to get a Thames view. Everyone who gets into equity release does it for all sorts of reasons, and upsizing is one of them. Economically this can make sense as a larger property will sell for more.”
Daren Carter, managing director of In Retirement Services, admitted that it was not something he had seen much evidence of. “We’ve had people move from their homes into retirement flats and have used equity release to bridge the gap between the two. This is certainly a new angle for me and not something I’ve come across, but we have seen equity release passed down to younger generations to help them get on the property ladder which is becoming more common.”
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