Almost half (44%) of all equity release applications in the first three months of 2023 were in relation to remortgaging, Equifax has found.

Research has revealed that the number of equity release applications also spiked rapidly in the past 12 months.

With mortgage rates rising and warnings from the Bank of England (BoE) that monthly repayments could go higher, Senior Capital has reported that those over-55s are rushing to find solutions that will enable them to access capital otherwise stuck in their property to support any necessary costs without selling.

The news of growing interest in equity release comes at a time when pensioners are beginning to outnumber children while slashed finances mean that retiring comfortably has been put on hold for millions of people across the UK.

The average pension pot currently stands at £107,300, indicating a lack of sufficient funds for a comfortable retirement. Furthermore, 22% of pensioners have stated that they have reduced or stopped spending on medications, with a further 5% have said that they have skipped meals, according to Age UK.

This has led to a 23% year-on-year increase in people turning to equity release, a financial service allowing homeowners to access capital tied up in their home without selling it, as a vital lifeline during to cost of living crisis.

Managing partner at Senior Capital, Rudy Khaitan, said: “In today's society, many over-55s find themselves in a paradoxical situation - they are ‘asset-rich’ due to the value of their homes, yet ‘cash-poor’ with limited disposable income. As the cost of living continues to rise, many find themselves struggling to make ends meet, despite owning valuable properties.

“Equity release offers a solution to this dilemma by enabling homeowners to tap into the wealth tied up in their homes. It can provide a much-needed cash injection to enhance their quality of life, cover unexpected expenses, or even help their families. Equity release is more than just a financial transaction; it’s a means of bridging the gap between asset wealth and living standards, ensuring that those who have worked their whole lives to build their assets can finally reap the benefits of their hard work.”

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