In the first quarter of the year there has been an increase in the number of homeowners using equity release to gift deposits or funds to family members. Figures released by Key Retirement, a finance specialist for those over the age of 55, show an increase from 22% to 26% of homeowners releasing equity in their property to make financial gifts.
One in four of those drawing down funds from their property are using the equity as gifted deposits for their dependants. From university fees to debt repayment and even starting businesses, by and large the funds are helping secure deposits for first home purchases.
The total value of equity released in the first three months of 2018 was at a record high of £777 million; this represents an average of £74,047 per homeowner. In London, figures were averaging an astonishing £128,400! 63% of these people were using a portion of the equity in their homes for home improvements.
Dean Mirfin, CEO of Key Retirement stated, “Gifting is a major motivation for equity release and our data shows it is more a case of parents and grandparents wanting to gift rather than children asking for help. They’re motivated by the desire to help when the money is really needed and being around to see the difference that it makes. In addition, equity release enables them to have some control over how the money is ultimately used.”
If you’ve recently been gifted funds to help you buy your first home, give us a call to talk through the size and the location of the property you are looking for, and benefit from our expert advice.