Global equity release market forecast to hit $50bn by 2033

Equity release analysis optimistic about the future

A major new report reveals that the global equity release market could hit $50 billion (£39.4 billion) by 2033 – more than twice its current size.

The Global Equity Release Roundtable 2023 survey report was published by The European Pensions and Property Asset Release Group (EPPARG) and EY. The data forming the report is taken from equity release market leaders across 13 countries in Europe, North America and Australia.

The report found that among the countries analysed, more than $17bn (£13.3bn) of equity is currently unlocked every year by homeowners. However, this amount is expected to soar to over $50bn (£39.4bn) by 2033 as the global equity release market continues to grow. The report reveals that the rising global demand for equity release is due to the cost-of-living crisis and higher inflation. 

David Burrowes, Chairman of the UK Equity Release Council and EPPARG Board Member, said:

“This survey resonates with the Council’s understanding that growth of the market and unlocking property wealth to support the growing needs of later life consumers’ needs greater customer awareness. Maintaining and increasing consumer confidence needs to be based on standards and innovation which support good consumer outcomes.”

As is the case here in the UK, the survey also found that the most common type of equity release globally is the lifetime mortgage, which is available in most of the countries surveyed. This is followed by home reversion, which is the other main form of equity release available in the UK. 

Drawdown equity release more popular in the UK than the global trend

When it comes to choosing how to receive money through equity release, it appears the most popular product globally is as a one-off cash lump sum lifetime mortgage – rather than in a series of withdrawals through a drawdown lifetime mortgage. 

This result is particularly interesting as it contrasts to the UK’s overall figures for last year. The majority (53%) of the 26,119 new UK equity release plans agreed in 2023 opted for drawdown lifetime mortgages, according to the Equity Release Council’s 2023 Market Report. 

That report indicates that UK customers are seeking the extra flexibility offered by drawdown, in part to manage higher interest rates seen over the last couple of years. Interest on drawdown plans is only applied to the money that is actively withdrawn from a cash facility, rather than the total available sum. Drawdown plans therefore enable homeowners to access what they need for now, then withdraw further funds at a lower rate in the future should they fall again.

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