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House price growth creates almost £800bn of potential equity

  • Q1 data reveals record high of £785.4 bn available to release across England, Scotland and Wales
  • Homeowners in the South-East have the greatest amount of equity available per household
  • Homes in the East Midlands have seen the greatest increase in value (+4%)

 

Almost £800 billion of equity was available for release in UK homes in Q1 2022, an increase of over £19bn in three months and the first time it has exceeded this milestone. The figures, based on the latest Halifax quarterly regional house price index and analysed by Canada Life, reveal that the total amount of housing equity available to homeowners aged over 55 now stands at an estimated £785.4 billion1.

 

The average price of a property in the South East is now £385k, creating £153.5bn of potential equity and making it the highest value region in the UK. This was closely followed by London where the average house price is now £534k creating £143.1bn of total potential equity. Homeowners in these regions can now expect to be able to release around £135k and £187k respectively. Homeowners in Wales and Yorkshire have the least amount of equity available per household with £55.8k and £67.2k available on average.

 

Property prices rose by 4% in the East Midlands, the biggest jump in the UK. Leading to almost £50bn of available equity and on average, £82k per household.

 

Alice Watson, Head of Marketing, Insurance, Canada Life said: “Everyone is noticing the increasing cost of living across the UK and people are feeling the pressure of rising inflation. Our latest research shows the sums that homeowners could expect to receive if they explored some of the value locked up in their property. With almost £800bn available across the UK, the collective pot is breaking new records every quarter.

 

“The diverse nature of equity release products mean that they can be used to meet a range of evolving needs. Whilst releasing equity from a property remains a very significant and individual decision it has a valuable role to play in helping today’s homeowners live the retirement they’ve worked for or to provide for other family members at difficult times. With the right advice, equity release has proven it can help people to access their property wealth flexibly and safely.”

 

Full regional breakdown of available equity:

 

 

Region

 

Potential equity release value available

Potential equity release value per household2

Scotland

£47.2 bn

£68.1k

North East

£19.7 bn

£56.9k

Yorkshire and The Humber

£45.3 bn

£68.1k

North West

£66.8 bn

£75.1k

East Midlands

£48.4 bn

£81.9k

West Midlands

£58.6 bn

£83.5k

Wales

£30.9 bn

£74.1k

East Anglia

£90.3 bn

£115.8k

South East

£153.5 bn

£135.0k

South West

£80.6 bn

£104.4k

London

£143.2 bn

£187.2k

Q1 Total

£785.4 bn

£1.05m

 

 

  1. Source: Property values listed are based on Halifax’s quarterly house price index. The potential equity release value has been calculated using the maximum loan to value (as of October 2021) for a 70 year old for Canada Life’s Capital Select Super Lite product based on the average regional house price and ONS population statistics. This has then been weighted based on the English Housing Survey’s property ownership figures for those aged 55 or over - this was then applied to each region to calculate the proportion of properties owned by those aged 55 or over.
  2. Numbers have been rounded - please ask for a full breakdown