Retired homeowners are increasingly using equity release to fund holidays abroad, new figures show.
According to Retirement Advantage, equity release has helped 2,132 people take a holiday so far this year.
Alice Watson, head of marketing for equity release at Retirement Advantage, said: “As we enjoy the height of the holiday season, it’s striking to see such a big increase in the proportion of equity release customers using the money they release to pay for getaways.
“This surge in use of equity release for holidays forms part of a wider trend among over 55s of proactively releasing wealth stored in their properties to fund an enjoyable retirement lifestyle. Retirees are not content with just getting by in their later years, they aim to enjoy their free time as much as possible. With the value of property wealth held by this demographic massively outstripping cash savings, it is not surprising to see some using equity release to help achieve this goal.”
Retirement Advantage’s research shows that in the first half of 2016 18% of its customers said they were using some of the money they released to pay for a holiday – up 4 percentage points compared to last year.
By applying their experiences across the UK, Retirement Advantage estimates this equates to 2,132 people taking a holiday so far this year thanks to equity release.
Watson said: “Alongside holidays, we’ve seen larger proportions of customers citing home improvements, gifting to family members and buying new cars as motivations for taking loans. As equity release continues to cement itself in the retirement finance mainstream, we expect to see ever more over 55s proactively using property wealth to fund a fulfilling retirement.”
A record amount of housing wealth was unlocked by homeowners in 2015 of £1.61 billion through equity release plans.
Equity release gives you access to the wealth tied up in your property without having to sell or move home. It is designed for older homeowners who own their property outright or have relatively small mortgages to pay.
You can borrow against the value of your home, sell it or part-exchange it for a lump sum or a regular monthly income.
EquityReleaseSupermarket provides comparison tables to you help research the various equity release plans available across the market.
To find out more about the latest equity release deals and how much you could potentially unlock from your property, click here.
