Homeowners in England and Wales could access the equivalent of five years’ worth of retirement income by using equity release, according to recent analysis by Legal & General Home Finance (LGHF).
Legal & General said house price inflation over the last five years means homeowners would have seen an average increase of 22% in the value of their property. This would see the average homeowner able to access £67,200 through equity release, which equates to five years of retirement income, according to the PLSA’s most recent ‘Retirement Living Standards’ report published earlier this year.
Homeowners in Wales were likely to see the biggest increases in recent years to the amount they can release from their homes, said Legal & General, with the amount rising by an average of 6% in the last year and 32% over the last five years.
The local authorities with the biggest increase in property wealth potential over the last five years include Blaenau Gwent (51%), Leicester (45%) and Manchester (43%).
“For many homeowners aged over 55, the value of their property is still proving to be one of their most significant assets, so it is no surprise that a growing number of homeowners are considering the role it might play in their long-term financial planning,” said Craig Brown, CEO, Legal & General Home Finance, adding:
“While equity release might not be right for everyone, it can make a significant difference to people’s retirement…
… Planning for how property can play a role in that is something we anticipate will become more commonplace, whether that’s by downsizing to free up funds or releasing money tied up in [a] home through products like lifetime mortgages.”
Top 10 local authorities with the biggest percentage increase in equity release potential over the last year
| Local authority name | Average equity release (24%) | Difference September 2022 with previous year (£) | Difference September 2022 with previous year (Percentage) |
| Blaenau Gwent | £30,000 | £3,960 | 15% |
| Westminster | £238,800 | £30,480 | 15% |
| Isle of Anglesey | £55,620 | £6,720 | 14% |
| Three Rivers | £134,400 | £15,600 | 13% |
| Kensington and Chelsea | £336,000 | £36,000 | 12% |
| Elmbridge | £168,000 | £18,000 | 12% |
| Pembrokeshire | £51,600 | £4,752 | 10% |
| Ryedale | £66,000 | £6,000 | 10% |
| South Hams | £92,400 | £8,400 | 10% |
| Richmond upon Thames | £184,320 | £16,320 | 10% |
| Ceredigion | £56,520 | £4,920 | 10% |
