Equity release: Bournemouth market update

Unlocking your home’s value in Bournemouth

Written in line with our editorial policy.

The popularity of equity release has been booming in recent years in Bournemouth and the South West. Between 2017 and 2021, the Equity Release Council reported a huge 25% increase in sales across the region. 

Despite a slight fall in average house prices in 2023, average house prices in Bournemouth have risen by more than £124,000 in the last decade. This has enabled homeowners aged 55+ to release more than ever through equity release as they make the most of their surging property wealth. 

If you are curious about how much you could unlock or how to go about arranging equity release in Bournemouth, make sure you read this quick guide. To help you gather the initial information you need, we’ll be discussing the following:

• What is equity release?
• Average Bournemouth property value rises by £124k in ten years
• Land Registry analysis of Bournemouth house prices
• What do higher house prices mean for Bournemouth equity release customers?
• What are the main types of equity release in Bournemouth?
• Am I eligible for equity release in Bournemouth?
• How can I arrange equity release in Bournemouth?

We hope this article will help you understand everything you want to know about arranging equity release in Bournemouth. For further information and advice from our selected advisers, please don’t hesitate to contact us. 

Simply call us on 0808 178 3055 or request a call back and we’ll arrange a no-obligation appointment with one of our selected equity release advisers for you. Or why not check your eligibility and find out how much you could unlock from your home.

What is equity release?

If you own your own property in the UK and are 55+ then an equity release plan may enable you to unlock a tax-free cash lump sum from the value of your home. 

You’ll probably have a good idea of what you need a tax-free cash boost for. Clearing the mortgage, making expensive home repairs, taking luxury holidays and gifting to family members are all popular reasons.

There are typically no monthly repayments to make with equity release. Instead, your home is usually put up for sale when you pass away or move into long-term care to repay your loan plus any interest. Any money left over is given to your estate to distribute according to your will.

If you want to speak to someone about equity release, call us on 0808 178 3055 or request a call back. Our selected advisers will be happy to explain everything you need to know.

Average Bournemouth property value rises by £124k in ten years

In 2022 the UK enjoyed record breaking average house prices – no doubt a contributing factor to the record sales seen by the equity release industry last year. 

House price growth has slowed since then, and fallen in some areas, but overall the increases over the last ten years have been significant. In Bournemouth alone, homeowners have seen their average house price increase by £124,421 over the last decade – a staggering growth of 60%.

In fact, house values have done so well in the area that property prices for the average home in Bournemouth are now worth £42,113 more than the average UK price. 

As a result of the increases, many homeowners across the South West are likely to have far more equity in their properties than when they bought them. By tapping into this property wealth – either through equity release or downsizing, for example – homeowners can improve their circumstances during financially challenging times.

Generally speaking, the higher a property is worth, the more cash is typically available to unlock through equity release. So, with that in mind, our analysis of Bournemouth equity release begins with a more detailed breakdown of property prices in the country over the last decade.

Land Registry analysis of Bournemouth house prices

Many homeowners in and approaching retirement are in a strong position due to owning their property for quite some years and typically having little or no mortgage left on it. 

As a result of their long-term ownership, older homeowners tend to benefit substantially from the overall market increases.

See the table below for a breakdown of how the average home in Bournemouth has increased in value every year since 2013, compared to the average home in the UK:

SOURCE: Land Registry House Price Statistics in Bournemouth, June 2013 – 2023.

What do higher house prices mean for Bournemouth equity release customers?

If you are lucky enough to have owned your home in Bournemouth for a few years then you potentially have a huge amount of equity sitting in your home today. 

So how much tax-free money can homeowners in or approaching retirement unlock in Bournemouth? Equity release plans typically allow borrowers to unlock up to 50% of their home’s value: the older you are, the more you can borrow.

The table below gives an example of how much additional tax-free cash a 74-year-old might  be able to release from a typical Bournemouth home now compared to a decade ago. This is based on them choosing to unlock 30% of their home’s value.

(These are example figures based on a 74-year-old opting to release 30% of their home’s value with a standard lifetime mortgage.)

Thanks to rising house prices, the homeowner in the above example could potentially unlock £15,539 more today than they could have done five years previously. If we compare to ten years ago, the same homeowner could access £37,326 more tax-free cash now.

How else is your cash release amount calculated?

In addition to your home being potentially worth thousands more than it was a few years ago, you will be older now, too. Why is that important? Because the older you are, the higher percentage you can unlock from your home’s value. 

Exactly how much you can release depends on your individual circumstances. The main factors that providers will consider include your age, property type, the condition and the location of your home.

Your health is also taken into account. This means that you may be able to unlock a higher amount, or access a more competitive interest rate, if you have certain health or lifestyle conditions. So having high blood pressure, diabetes, a history of strokes or cancer, or one of the other qualifying conditions, could see you accessing more cash from your home.

What are the main types of equity release in Bournemouth?

For those currently considering equity release, Bournemouth homeowners can choose between a lifetime mortgage or a home reversion plan.

Lifetime mortgages

These are the most commonly sold plans. In addition to offering a range of flexible options, you will also continue to own 100% of your home. Here are just some of the features of a lifetime mortgage which can you build in to your plan:

• Interest-only lifetime mortgage: You can prevent or reduce interest from accruing on your loan by agreeing to pay off some or all of the interest each month. 
• Drawdown lifetime mortgage: Unlock an initial lump sum now, then access further funds in the future as and when you want to. This can save you a significant amount of interest over time.
• Downsizing protection: Sell your home and repay your plan in full without any early repayment fees within a set number of years of your spouse/partner passing away or moving into long-term care.
• Enhanced lifetime mortgage: Access more money from your home or enjoy lower interest rates if you have a qualifying health condition, or a history of smoking.

Home reversion plan

This is available to homeowners aged 60 or over and may enable you to release a higher amount than a lifetime mortgage. A home reversion plan involves selling all or some of your home to a reversion company in exchange for a tax-free cash lump sum. You then continue to live in your home with the same rights as a tenant, but paying no rent. 

As with a lifetime mortgage, you can stay in your home for the rest of your life, or until the last surviving homeowner moves into long-term care.

Am I eligible for equity release in Bournemouth?

To be considered for equity release, Bournemouth homeowners must:

• Be 55 or over (both of you if making a joint application).
• Have a home in the UK worth £70,000 or more.
• Be mortgage-free or have a small mortgage which can be paid off by the money you release.

If you meet the above criteria then you can check your eligibility and see how much you could unlock from your home.

Not yet 55? You may still be able to access some of your equity. Read how in our article: “How to release equity if you are under 55.”

How can I arrange equity release in Bournemouth?

If you’re ready to find out more about equity release, Bournemouth homeowners should speak to a specialist equity release adviser.

This is to ensure you receive guidance on all types of plans from someone who can tell you if equity release is the right financial option for you right now. Having all the correct information to hand now can prevent equity release horror stories from happening in the future.

Our selected advisers are ready to help you explore your Bournemouth equity release options and find the best plan for your needs. They will help you to:

• Check your eligibility for equity release.
• Understand if a plan is the best option for you, or if an alternative might suit you better for now.
• Search for the most competitive equity release quotations.
• Explain all the benefits and drawbacks of each type of plan.
• Help you decide which plan and features best suits your wants and needs.
• Expertly guide you through the whole process if you choose to go ahead.

Simply call us on 0808 178 3055 or request a call back for a time that suits you, and we’ll arrange an appointment with one of our selected advisers. Alternatively, check your eligibility and get an initial indication of how much tax-free cash you could unlock.

About Clare Yates. With over a decade’s experience writing about later life financial planning, Clare offers a wealth of knowledge about equity release, pension annuities, wills, LPAs and more. When she isn’t writing, Clare likes to spend her time baking and going on walks with her husband, two children and their rescue dog. Follow Clare on LinkedIn