Quarter on quarter, total lending rose by 6% to £615m while new plans agreed increased by 2% to 5,370 marking the first time in two years that the market has recorded two successive quarters of growth.
Meanwhile, further advances were up 8% on the previous quarter but total plan numbers and returning drawdowns fell by 0.3% and 3% respectively.
Consumer confidence grows
In its latest quarterly market report covering the period between July and September, the Equity Release Council noted that consumer confidence was “steadily returning” to the market.
Average equity release loan sizes increased by 1% on the previous quarter with new lump sum lifetime mortgage customers taking £111,618 while those taking drawdown lifetime mortgages took £69,952 upfront and reserved another £49,747 for future use.
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New initial drawdowns, however, rose by 7% in value taking the average equity release drawdown to £69,952.
Annual activity is still down, however. Total lending and new plans agreed were 14% and 27% lower than Q3 2023 respectively. Returning drawdowns and further advances were also lower, down 8% and 10% respectively.
“Encouraging” signs
David Burrowes, chair of the Equity Release Council, said: “Returning growth may have been modest to date, but it’s particularly encouraging to see the trend continue during the transition period sandwiched between the arrival of a new government in early July and its first Budget statement later this month.
“Behind these improving numbers are reports from both advisers and providers alike that consumer confidence is steadily returning.
“That may not translate into an uninterrupted upwards trajectory from here, but we know there are many households who have decided that releasing equity is right for them and are now focused on ensuring the timing is also right.”
