New research from Legal & General reveals
Legal & General’s ‘Silver Spenders’ report found that cash accessed by equity release supports gross output by up to up to £7.1bn
Briton’s releasing equity from their homes for retirement have supported the UK economy by over £7bn in 2017, according to new research from Legal & General Home Finance and the Centre for Economics and Business Research (CEBR). The lifetime mortgage lenders ‘Silver Spenders’ report found that equity release contributes up to £7.1bn to UK gross output.
Lifetime mortgages – a type of equity release – have seen a surge in popularity amongst Britain’s older homeowners in recent years, becoming the fastest growing sector of the mortgage market. Lifetime mortgage sales tripled between 2013 and 2017, rising from just over £1bn to more than £3bn in 2017, according to the Equity Release Council.
The new research set out to analyse the current direct, indirect and induced impact of the equity released from homeowners’ properties on the UK economy and specific industries. It found that for every £1 of housing wealth accessed through equity release products, £2.34 is generated for the British economy.
Breaking down the direct economic impact industry by industry, manufacturing benefits the most from equity release spending to the tune of £1.34bn, whilst the construction sector benefits from a £349m injection – the equivalent annual salaries of 14,000 construction workers or 11,400 electricians. Health and social work was also supported by equity release spending. The research highlighted that the sector was boosted by £203m, which is the equivalent of 7,500 nurses, 3,200 doctors or 9,600 community workers.
When analysing the actual number of jobs created by equity release spending, Legal & General’s research found that equity release supports 37,100 jobs directly and indirectly across the UK. And this is likely to grow significantly over time.