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Advisers expect average age of equity release customers to go up in 2019

New figures from Canada Life Home Finance reveal that more than two-fifths of financial advisers expect equity release clients will be older on average in 2019 than they were last year.


When asked how they think the demographics of equity release customers will change from 2018 to 2019, 42% of advisers said they expect an increase in the average age of people who take out equity release, which was 71 in 2018. In contrast, less than a third (30%) think that the average age will fall.


Alice Watson, head of marketing and communications at Canada Life Home Finance, said:


“It isn’t too hard to see why a significant proportion of advisers expect to see older equity release customers in 2019. Historically, equity release products have been better suited to older homeowners. With today’s pension pots dwindling and more people understanding how property wealth can help fund retirement, it is reasonable to expect more retirees will tap into property wealth at a later stage when they are more likely to have depleted pension savings."


“However, it is notable that almost a third of advisers expect the average age of equity release customers to fall. With the latest ERC figures showing more equity release customers than ever before, it makes sense that a number of these will be younger homeowners."


“While it is good news that equity release is becoming attractive to a wider demographic, it won’t be the most suitable solution for everyone. And there is no right or wrong answer on the best age to take out equity release. This is why independent financial advice is so important.”


Canada Life’s research also shows that two in ten (20%) advisers expect the average price of an equity release property will be higher in 12 months’ time, compared to 14% of advisers who think that properties will be worth less. The average price in 2018 was £300,000.


Similarly, two in ten (20%) advisers expect the average equity release loan will be larger than 2018’s £78,000 average, while a mere 3% think loans will be smaller on average.


Alice Watson continues:


“Advisers are clearly looking beyond today’s stagnant house market and expecting growth. It remains to be seen what house prices do in the coming year, but with growing product innovation and more people taking a holistic approach to retirement planning, we could start to see housing wealth establish itself further as a key pillar of later-life financial planning.”

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Canada Life Limited is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority.

Canada Life International Limited and CLI Institutional Limited are Isle of Man registered companies authorised and regulated by the Isle of Man Financial Services Authority.

Canada Life International Assurance (Ireland) DAC is authorised and regulated by the Central Bank of Ireland.

Stonehaven UK Limited and MGM Advantage Life Limited, trading as Canada Life, are subsidiaries of The Canada Life Group (U.K.) Limited. Stonehaven UK Ltd is authorised and regulated by the Financial Conduct Authority. MGM Advantage Life Limited is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority.