Home improvements continued to be the primary reason for new equity release customers, data from Legal & General Home Finance shows.
The data shows that 51% of new equity release customers took out a lifetime mortgage last year.
Customers often used their lump sum to invest in improving their forever home. This includes adaptations to make sure a property remains suitable into retirement, alongside other types of home improvements.
Moreover, customers took out lifetime mortgages to help get their finances in order. This includes debt consolidation (21%) and paying off mortgages (26%).
Customers taking additional drawdowns, however, were more likely to use the value from within their homes to help supplement their income (23%).
Analysis of English Housing Survey data by the Centre for Ageing Better suggests that 91% of homes across the country do not provide basic accessibility features, which presents challenges as people age.
Legal & General Home Finance chief executive Craig Brown said: “Property wealth can be a valuable asset and, looking at the new customers who came to us last year, we can see that home improvements continue to be the most popular use of equity release, helping people to improve rather than move.
“As we look ahead to the rest of 2024, we anticipate a renewed interest in lifetime mortgages as customers reconsider using property wealth as the market likely stabilises. It’s worth bearing in mind that house prices are still significantly higher than pre-pandemic figures (18% up from the end of 2019), so property still represents an important asset which homeowners are increasingly likely to draw on3.
“We’re also seeing more innovation in the market, bringing a greater range of products, like our new payment term lifetime mortgage, to give a broader range of solutions to a wider pool of customers.”