Equity release can help the economy

Posted in General

7th April 2010

If you release equity from your house, you could be helping the economy recover from the recession, according to an expert.

Howard Archer, the chief UK economist at IHS Global Insight, states that equity release can help boost consumer spending.

For example, if homeowners decide to take money as a lump sum, it can be spent in car showrooms, travel agents, hotels or high street shops.

Mr Archer commented "with unemployment levels rising, and people taking pay cuts you do not want any more money to be taken out of the consumer economy."

This announcement comes with the news that since mid-2008, over £35bn (£36.5bn) has been spent on over-paying on mortgages, rather than spending on consumer goods. This is compared to just the final quarter of 2003, when over £17bn (£17.02bn) of home equity was released.

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