Equity Release Market Affected by the Budget and House Prices
News in the equity release market during March was marked by fluctuating average house prices, inflation and pensions. With the announcement of the 2010 Budget during the month, it was inevitable that issues directly affecting finance would bring equity release into the headlines.
March started with a difference from other recent months as The Nationwide and Halifax reported that the average price of a UK house had dropped marginally month-on-month. It was felt that the uncharacteristically bad weather had attributed to the deficit. However, figures were still up on a three-month-to-three-month basis.
The Mortgage Strategy Awards, which acknowledge the finance sector, announced their annual results at the end of February and Age Partnership were crowned Best Equity Release Mortgage Broker 2010.
An All Party Parliamentary Group voiced their opinion that equity release can help with the pension crisis. They believe that high quality advice should help re-shape the impression about equity release and championed its merits to the Government.
Equity Release, Pensions and Credit Cards
This was followed by news of Government plans to restrict credit card lending, as figures suggested that many consumers have over £9,000 in debt on their cards, and how equity release could help customers with debt.
Pensions and equity release was again making the news during the middle of the month after Safe Home Income Plans (SHIP) information showed that 61% of people plan to rely on the state pension when they retire. SHIP’s information also suggested that by 2030 there will be £359 billion in housing equity available to homeowners.
As the month began to draw to a close, a school of thought intimated that regular house price rises could be viable in the future.
This area of thought was followed by the findings that 55-64 years were amongst those paying the most when it came to inflation. Because they are the age group immediately approaching retirement, an equity release scheme might seem more appealing.
Finally the month was brought to a close on an encouraging note for the equity release market as house prices once again improved. It was also revealed that customers considering an equity release scheme might benefit from the higher house values compared against 12 months earlier, where an average of £14,000 was added to property.
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