Homeowners aged over 55 unlocked £1.85bn in housing wealth in the first half of this year, according to the Equity Release Council’s Autumn 2019 Market Report.

There is now an “unprecedented level” of product choice and flexibility in the equity release market, the council noted. Compared to July 2018 the range of products increased two-fold in July 2019, to almost 300 options.

There was increased growth across all product areas, with the top five being sheltered or age-restricted accommodation, interest-serviced (regular interest payments), downsizing protection, inheritance guarantees and drawdown facilities.

The annual rise in the number of products available in the sheltered and/or age-restricted accommodation category was 269% (from 42 to 155), while downsizing protection options also doubled (from 63 to 129).

Products offering the ability to make regular interest payments increased to 81, up 80% since the start of the year and almost quadrupling year-on-year.

The report also revealed that the average equity release rate fell below 5% for the first time, to 4.91% in July 2019. Over half (58%) of products offered a rate of 5% or less, while a fifth (21%) of products were priced at 4% or below.

The average age that customers took out equity release was 70.3 years old for new drawdown plans, and 68.0 years old for new lump sum plans.

Equity Release Council chairman David Burrowes said: “The equity release market is responding to consumer demand as it continues to evolve and grow. Increased product innovation and flexibilities are helping to meet a wide range of financial and social needs, from providing extra retirement income to passing on wealth to younger generations.

“It’s vital that advisers across a host of areas – including pensions and wealth management – can identify when equity release may or may not be suitable based on today’s product range, and can refer a client for specialist advice where appropriate.”

Also responding to today’s report, Responsible Life managing director Steve Wilkie said that the market had “come of age in a big way this year”.

“This growth means customers find it even easier to find a product perfectly suited to their needs, which also offers the flexibility they require for their later life finances,” he added.

“It is almost impossible to imagine the industry will ever return to being a niche area of financial services that was very much seen as alternative rather than mainstream in its formative years.”

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