Retirement Advantage has estimated that 18 first time buyers a week took a step on to the housing ladder in 2017 thanks to family members taking out equity release loans.
Its research estimates that 2.6% of the 36,825 equity release plans taken out last year were taken out by customers intending to use the funds to help a relative buy their first house. This equates to 18 people being helped onto the housing ladder each week.
With over £3bn taken out in equity release nationally last year, loans taken out to help first-time buyers were worth an estimated £79m.
The estimates are based on Retirement Advantage customer survey data and national Equity Release Council figures for 2017.
Alice Watson, head of product and marketing at Retirement Advantage, said: “With the growth in equity release in recent years, we’ve seen people are not only using equity release to help support them in retirement or clear outstanding debt, but increasingly also to pass on an early inheritance to help their relatives onto the property ladder. With higher house prices making home ownership a greater challenge for this generation of first-time buyers, it is little surprise that more relatives are passing on the benefits they’ve received from having greater equity to the next generation.
“It also pays testament to the fact that many are increasingly at ease with viewing their assets holistically and tapping into their property wealth, so they can see it enjoyed by their relatives during their lifetimes. If house prices continue to rise and more people view using property wealth in this way as a norm, equity release could become a significant route to home ownership in the coming years.”