Individuals in these groups are increasingly viewing their mortgage as ‘adventure equity’ which allows them to embark on life changing adventures. These people have turned their back on institutions and corporates in favour of new career paths, organic lives, risk and adventure, according to the report, published by Standard Life Bank/The Future Laboratory .
Alan Dring, Standard Life Bank Head of Sales, said it was important that financial advisers recognised that homeowners no longer viewed their mortgage as a millstone.
Mr Dring said the growth in property value in the last five years, coupled with the introduction of flexible mortgages – such as Freestyle from Standard Life Bank - that allowed homeowners to draw down money to fund projects other than home improvements, had led to a shift in attitudes.
“What this change presents for financial advisers is the opportunity to identify and address the change in desires and aspirations of people in their 30s and 40s, particularly women, who are, for now at least, opting against settling down and instead looking to pursue new life challenges,” he said.
“In an environment with so many challenges, there is clearly an opportunity for financial advisers to tap into key groups that have an obvious need for good advice and alternative product options.”
The Standard Life Bank report found that four distinct social groups have emerged. People in these groups - Contrasexuals, Cross-shifters, New Authentics and HEROs - are making every effort to change their lives for the better.
Mr Dring said the combination of the increase in value of their home and new mortgage opportunities had given these equity rich social groups the impetus to change their lives and live their dreams.
Contrasexuals are women in their 30s and 40s who are turning their back on the Bridget Jones stereotype. While not necessarily single, the Contrasexual is singular in outlook and wants to learn new skills, try new food, wine and places… and do it alone. From taking months off to explore the depths of Outer Mongolia, to setting up a conservation sanctuary in Borneo, Contrasexuals are ready to realise their aspirations and nothing is going to stand in their way.
Cross-shifters are abandoning the corporate rat race in favour of their own career paths. With the equity in their homes and successful career experience behind them, they possess the financial clout and transferable skills to make the transition smoothly and successfully.
A second group, The New Authentics, is similarly dissatisfied with the soul-less corporate grind. But their way of dealing with the situation is rather different; 70 per cent of this group were willing to halve their salaries to improve their quality of life. They want to take risks, to learn and gather knowledge and experience life-changing moments. Equity in their homes is critical to achieve this.
The third group, High Earner, Risk Open [HERO], has money and skills behind it like Cross-shifters and New Authentics – but they are prepared to risk everything in search of adventure, and in the pursuit of their dreams.
Mr Dring said it was important that financial advisers recognised that what these groups had in common was that they had houses in which they had built up equity. These people understand the financial power that their home gives them to change the way they live.
“By understanding the emerging trends in the UK mortgage market, advisers will undoubtedly unlock future earning potential. Working in partnership with clients to understand their needs will develop a lasting and profitable relationship with opportunities for future growth.”
Mr Dring said that increasingly, customers weren’t burdened by the idea that a mortgage is a financial millstone. Instead they are at the forefront of a major trend to use mortgages to break out of unsatisfying jobs and lifestyles.
