Equity release sales 'top £613m'

Wednesday, 03 November 2010 12:00

Sales of equity release plans have shown "strong growth" in the first nine months of 2010, mainly thanks to increased demand for home improvement work.

This is according to Key Retirement Solutions (KRS), which said a total of 17,121 policies worth £613.3 million were agreed between January and September.

During the corresponding period of last year, homeowners took out 15,969 plans valued at a combined £586.7 million.

Equity release allows a property owner to unlock part of the value of their house as either a tax-free lump sum or regular income.

KRS said almost two-thirds (63 per cent) of people taking out one of the plans in the first nine months of the year used some of the cash they received to carry out home and garden improvements.

This was up from 43 per cent in January to September 2009.

Another 35 per cent of this year's equity release customers used the money to pay off loans or credit card debts, while 31 per cent put it towards a holiday.

Friends Provident recently said equity release schemes will become "significantly more commonplace", as 77 per cent of retired people want to stay in their house for the rest of their lives.

Read our free expert guide to equity release here.

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