The £698m of property wealth accessed in Q2 was a 34% drop from Q1 2020, but the slight recovery in equity release demand seen in June is a sign of things to come, according to Legal & General.
Commenting on the Equity Release Council’s (ERC) market statistics, Claire Singleton (pictured), CEO of Legal & General Home Finance, said: “What these figures show is that people have been cautious about committing to long-term financial decisions during the pandemic, and whilst so many activities that often prompt interest in equity release were on hold.
“A dip in demand is to be expected in these circumstances.
“The decision to pause and take time to consider their options will have been the right one for many homeowners, and people should always think carefully before taking out a lifetime mortgage.”
The effects of the pandemic, either on people’s household finances, or on their ability to indulge in leisure activities, will likely spur on demand for equity release market.
Singleton said: “As the economic picture becomes clearer I think demand will return.
“I anticipate some homeowners will look to supplement their income or support family members through gifting.
“For others, the easing of lockdown will open up opportunities for holidays, weddings and those other ‘big ticket’ events which drive demand.
“Figures earlier in the year, and initial signs of recovery as lockdown eased in June, back this up, showing that the underlying demand is there.
“In the longer-term, I expect the growing recognition of equity release as a valuable product to continue.”