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Potential equity release stands at £622bn

  • Homeowners in England, Scotland and Wales are sitting on a potential £622bn windfall in untapped equity1
  • The South East has the highest value of equity available (£118bn) while homeowners in London have the greatest amount per household (£145,000)
  • Equity release has the potential to boost to retirement incomes at a point where FCA data2 reveals the most popular withdrawal rate for pensions valued up to £250,000 is 8%

 The total amount of housing equity available to homeowners aged over 55 now stands at an estimated £622bn, according to Canada Life’s latest property value tracker. The figures, based on the latest Halifax quarterly regional house price index and analysed by Canada Life, reveals that the amount of equity available has increased marginally from when the data was last crunched in Q2 2023 when it stood at £616bn.

The average price of a property in the South East is currently £385,751, creating £118bn of potential equity and making it the highest value region in the UK. This is closely followed by London where the average house price is now valued at £539,916, creating £111bn of total potential equity. Homeowners in these regions can now expect to be able to release around £104,153 and £145,777 respectively. On the other hand, homeowners in the North East and Scotland have the least amount of equity available per household, with £46,530 and £55,305 on average.

Sadna Zaman, Proposition Development Manager, Canada Life Home Finance said:

“Equity release can be a powerful tool to unlock the wealth tied up in your home and improve your retirement lifestyle. Despite the various economic headwinds and general uncertainty over the past year, property prices have remained firm, and even edged up in some areas. This resilience in the property market continues to create significant housing equity which can be released by homeowners looking to improve their retirement prospects. 

“The latest FCA retirement income data just released shows the most common withdrawal rate for pensions for pot values up to £250,000 is 8%. People may be deliberately depleting their pensions as part of well-informed financial plans, but it may well be that some will be left wondering where their pensions have evaporated too in due course. While I certainly wouldn’t want to see equity release seen as a purchase of last resort, the product will continue to remain a key part of later life planning.

“For older homeowners looking to free up cash from their homes, equity release can be used to meet their evolving needs in later life, whether that be to boost income, pay for the cost of care or make home improvements. Releasing equity remains a significant financial decision, but it will continue to play a vital role in retirement planning. Equity release can offer flexible ways to meet individual customer requirements.”

Full regional breakdown of available equity

Region

 

Potential equity release value available

Potential equity release value per household2

Scotland

£38.3bn

£55,305

North East

£16bn

£46,530

Yorkshire and The Humber

£37.2bn

£55,952

North West

£55.8bn

£62,725

East Midlands

£39bn

£64,787

West Midlands

£48.1bn

£68,611

Wales

£24.7bn

£59,187

East Anglia

£69.6bn

£89,269

South East

£118.4bn

£104,153

South West

£63bn

£81,549

London

£111.5bn

£145,777

Q1 Total

£622bn

 

 

ENDS

Enquiries:

Press enquiries should be directed to:

Paul Keeble, Canada Life, 07833 085387, Paul.Keeble@canadalife.co.uk

Notes to editors:

  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 April 2024) 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. Source:      https://www.fca.org.uk/data/retirement-income-market-data-2022-23
  3. Numbers have been rounded - please ask for a full breakdown.

 About Canada Life:

Canada Life is part of a group of companies controlled by Great-West Lifeco Inc., a diversified financial services holding company headquartered in Winnipeg, Canada. Through its subsidiary companies, Lifeco has operations in Canada, the United States, and Europe. Great-West Lifeco and its insurance subsidiaries have received strong ratings from major rating agencies.  Great-West Lifeco has over 42 million global customer relationships worldwide and £1.52trillion assets under administration (as at 31 December 2023).

Canada Life Limited began operations in the United Kingdom in 1903 and looks after the retirement, investment and protection needs of individuals and companies alike.

Canada Life Limited is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. Registered in England and Wales no. 973271. Registered office: Canada Life Place, Potters Bar, Hertfordshire EN6 5BA. Canada Life Platform Limited, trading as Canada Life, is a subsidiary of The Canada Life Group (UK) Limited, and is authorised and regulated by the Financial Conduct Authority. Registered in England and Wales no. 8395855. Registered office: Canada Life Place, Potters Bar, Hertfordshire EN6 5BA.

Stonehaven UK Limited, trading as Canada Life, is a subsidiary of The Canada Life Group (U.K.) Limited. Authorised and regulated by the Financial Conduct Authority. Registered in England and Wales. Registered number: 05487702. Registered office: Canada Life Place, Potters Bar, Hertfordshire, EN6 5BA.

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