Over a Third of Lifetime Mortgages Used for Holidays and Leisure
According to LV=, 9% of over-50’s are planning to use their homes to help fund retirement, and it appears that over a third of them plan to enjoy it too. This is because Saga Personal Finance reported that 34% of homeowners taking out an equity release scheme – the most popular of which is a lifetime mortgage – plan to use some of the money for holidays and other leisure pursuits.
Homeowners are continuing to place confidence in bricks and mortar as LV=’s latest stats allude to but SPF’s information indicates a growing trend for lifetime mortgages and other equity release schemes to be used for more than just re-paying debt.
Clearing Debt and Home Improvements Popular Uses of Lifetime Mortgages
Saga Personal Finance’s stats show that 40% of lifetime mortgages were used for clearing debt and 20% gave £27,000 or more to their family.
Plus, 52% of over-60’s plan to use equity from a lifetime mortgage for home improvements to increase the value of their property, spending on average £11,000 each.
Popular equity release schemes like lifetime mortgages are a great way for homeowners to supplement their income in retirement, allowing many homeowners to not only just survive but also enjoy their life to the full.
Alex Edmans of Saga Personal Finance commented: “Our findings dispel the often held myth that equity release is just a last resort for cash strapped pensioners, when in fact people use the capital in their home to enjoy life, not just to get by.”
Homeowners Confident Their Home Can Help Finance Retirement
Continued house price increases, as reported by the Nationwide this week, is also adding to the growing confidence in property felt by many pre-retirement homeowners.
Vanessa Owen, head of equity release at LV=, says: “House prices still have some way to go before full recovery but with increases for seven consecutive months now, home owners are feeling more confident that their home can still play a big part in helping to finance their retirement; their confidence in the long-term value of bricks and mortar remains.”
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