Figures for 2016 show equity release booming as homeowners draw down to meet financial needs, writes Beverley Brown
WHILE average house price gains in Scotland were around a modest three per cent in 2016, the equity release sector is booming, arguably evidence of the need for first time buyers relying on the bank of Mum and Dad for a helping hand.
The total value of equity release lending in 2016 was £2.15bn – a rise of 34 per cent on 2015 and double the rate of growth from 2014 to 2015 – making it a landmark year for the sector, says the Equity Release Council, whose members account for around 95 per cent of equity release lending in the UK.
Drawdown products remain the most popular and account for 65 per cent of the market, however, the appeal of lump sum products saw them record their largest share by volume of new plans agreed (35 per cent) since 2010, which the Council says is likely influenced by the use of equity to repay mortgage debt as well as meeting other financial needs.
"Surpassing the £2bn mark for the first time indicates that housing wealth is becoming an increasingly important focus of retirement planning," says Council chairman, Nigel Waterson.
Why are you making commenting on The Herald only available to subscribers?
It should have been a safe space for informed debate, somewhere for readers to discuss issues around the biggest stories of the day, but all too often the below the line comments on most websites have become bogged down by off-topic discussions and abuse.
heraldscotland.com is tackling this problem by allowing only subscribers to comment.
We are doing this to improve the experience for our loyal readers and we believe it will reduce the ability of trolls and troublemakers, who occasionally find their way onto our site, to abuse our journalists and readers. We also hope it will help the comments section fulfil its promise as a part of Scotland's conversation with itself.
We are lucky at The Herald. We are read by an informed, educated readership who can add their knowledge and insights to our stories.
That is invaluable.
We are making the subscriber-only change to support our valued readers, who tell us they don't want the site cluttered up with irrelevant comments, untruths and abuse.
In the past, the journalist’s job was to collect and distribute information to the audience. Technology means that readers can shape a discussion. We look forward to hearing from you on heraldscotland.com
Comments & Moderation
Readers’ comments: You are personally liable for the content of any comments you upload to this website, so please act responsibly. We do not pre-moderate or monitor readers’ comments appearing on our websites, but we do post-moderate in response to complaints we receive or otherwise when a potential problem comes to our attention. You can make a complaint by using the ‘report this post’ link . We may then apply our discretion under the user terms to amend or delete comments.
Post moderation is undertaken full-time 9am-6pm on weekdays, and on a part-time basis outwith those hours.
Read the rules hereComments are closed on this article