Equity release growth in northern regions of the UK outpaced the south in 2018, mirroring trends seen in the house price market.
Analysis by broker Equity Release Supermarket revealed, in areas where there had been rises in house prices, the sale of its plans have also seen the highest increases.
It said the North East was the ‘stand-out’ story with equity release sales soaring by 117% year-on-year, closely followed by the East Midlands at 92% and then Scotland, Wales and Yorkshire and Humberside.
Meanwhile, at the opposite end of the scale and in line with house price movements, London experienced the smallest rise in equity release plan sales, increasing by just 19%. Equity Release Supermarket said this was likely to be linked to house prices falling 0.8% year-on-year in the capital.
High value in the East Midlands
When it came to the amount of money being lent through equity release there was also a striking correlation with house prices. In the East Midlands sales value grew by 140% year-on-year, which Equity Release Supermarket said was clearly linked the 4% annual house price rise which made the region the second fastest growing region in 2018, after Northern Ireland.
Scotland, Yorkshire and Humberside and the North East also came out at the top for the growth in value of equity release sales plans, mirroring house price trends.
London still dominates
But while the Northern regions have shown the strongest growth in the number of people taking out equity release plans, it’s the southern regions which have dominated the sales landscape, according to Equity Release Supermarket’s figures.
And even though London had the slowest growth, year-on-year, it remained the most attractive region for taking out the later life lending product.
Mark Gregory, founder and CEO of Equity Release Supermarket, said: “We have seen exceptional annual growth in terms of both the number of plans sold and the value of these plans.
“However, growth in the equity release market is in stark contrast to the broader housing market, which continues to be weighed down by ongoing economic uncertainty.
“It will be interesting to see if these trends continue in 2019 as it could impact how equity release providers, particularly those with regional lending policies or those with ‘on the ground’ sales forces, manage their businesses in the year ahead.”
