The number of customers who used equity release for home improvements slightly rose in Q4 2018 to 47 per cent compared to 46 per cent in the same quarter in 2017.
Of the 47 per cent of customers who used equity release to improve their home or garden in Q4 2018, over a third used it for improvements adding value or extra enjoyment, such as extensions or conservatories.
The remaining 10 per cent used equity release for accessibility improvements that made their homes safer or more comfortable, such as stairlifts or wheelchair ramps.
The second most popular use of equity release in 2018 was to clear existing mortgages, standing at 38 per cent. The biggest year-on-year shift was in the number of people unlocking the value of their home to clear a residual mortgage in Q4 2018 at 44 per cent, up almost 10 per cent on Q4 2017, at 35 per cent.
More than one in four people used equity release to manage unsecured debts in 2018. Last year’s final quarter figure for unsecured debt was also the same as 2018 as a whole, rising slightly from 25 per cent in Q3 2018.
Other popular uses for equity release among UK households in 2018 were holidays at 22 per cent, day-to-day living at 21 per cent and gifting to family at 16 per cent.
Home alterations highest since 2015
Alice Watson, head of marketing and communications at Canada Life Home Finance (pictured), said: “It is significant how many people are untapping the value of their property to fix-up their home, or increase their comfort and security as they grow older.
“This significance is even clearer when seen in the context of the latest data from the ONS, which shows the amount spent by 50-74 year olds on alterations to their house is at its highest level since at least 2015.
“Taking out equity release to fund home and garden improvements benefits more than just the current occupiers. Such enhancements can add value to the property and help pass on wealth to future generations.”
Watson added that these figures also show the significant number of retirees that are taking out equity release to consolidate existing debt.
She said: “Alongside the number of customers gifting to their family and using equity release to make improvements to their home or garden, these are signs that more people are aware of the inter-generational benefits of equity release.
“As the Equity Release Council figures last week showed, the equity release market is going from strength to strength. We fully expect the market to keep growing and customers to continue to diversify their reasons for using equity release.”