Leeds Equity Release – 2023 market report

The latest trends for Leeds equity release

In our 2023 market report, we look at how rising property prices over the last five years have fuelled a 26% growth in the Yorkshire equity release market. We take a closer look at the impact of rising property prices – and how much extra you may now be able to unlock if you’re a homeowner in Leeds.

The equity release market has been booming over the past decade. Its continued growth in 2022 saw a record-breaking 93,421 new and returning customers unlocking their property wealth, according to Equity Release Council figures.  

The availability of new plans and flexible product features in the last few years has undoubtedly contributed to this growth. For instance, since March 2022, all new equity release plans allow customers to make voluntary partial payments on their plans to reduce interest. 

Record average house prices achieved last year may also be a contributing factor, as this can affect how much more someone can unlock from their home. Homeowners in Leeds have enjoyed a 30% property boom in the last three years alone, for example.

In this article we’ll explore the latest trends for equity release in Leeds, including:

• What is involved in equity release in Leeds?
• Average Leeds house values rise £110k in ten years.
• What does the house price boom mean for Leeds equity release potential?
• Growth in the Leeds equity release market.
• Do Leeds Building Society offer equity release?
• Will slowing property prices affect the Leeds equity release market?
• Extra flexibility adds to the popularity of today’s equity release plans.
• Alternatives to equity release in Leeds.
• Find out more about Leeds equity release.

What is involved in equity release in Leeds?

Before we get into the finer details of our Leeds equity release market report, it’s worth explaining briefly what equity release is and how it works. An equity release plan allows homeowners aged 55+ to unlock some of the tax-free money tied up in the value of their homes without having to move house. The money unlocked can be spent in any way the homeowner wishes, once any outstanding mortgage is paid off.

A lifetime mortgage is the most popular type of equity release plan. Available as a lump sum or drawdown plan, Leeds equity release customers could access their property wealth without the need to make any monthly payments. This is because the loan plus interest doesn’t have to be repaid until the homeowners have passed away or moved into long-term care.

Many prospective Leeds equity release customers will be eligible  to release the tax-free cash needed to boost their retirement years. As we’ll discuss in this report, that’s because they are likely to have significantly more equity than they did just a few years ago.

Average Leeds house values rise £110k in ten years

The value of a property is one of the main deciding factors when calculating how much tax-free money the homeowner can unlock with an equity release plan. The higher the value, the more they could potentially release. For this reason, our analysis of equity release in Leeds starts with a review of property prices over recent years.

It’s been widely publicised that UK house prices have risen dramatically over the past decade or so. This table shows how they have risen in Leeds since 2012, compared to UK average house prices:  

SOURCE: Land Registry price paid dataset for properties sold in Leeds 2012-2022.

To sum up the numbers in the above table, the average house price in Leeds rose by £110,775 in the last decade – a growth of 58%. In 2021 alone, a staggering £1million was added to the UK’s housing market every minute according to the Equity Release Council. 

Despite some gloomy predictions made in recent months, house prices continued to increase last year. In Leeds, the average house price rose from £215,012 in 2021 to £246,876 in 2022. Such is the growth in Leeds house prices, the £31,864 increase outstrips the UK’s average regular earnings – before tax or housing costs – of £30,576.

According to the Yorkshire Evening Post, owners of detached houses in Leeds saw the biggest monetary rise in property prices in the 12 months leading up to October 2022. 

Detached properties in Leeds rose to an average value of £457,653 – that’s a 14.9% growth in one year. Semi-detached houses increased by 15.2% annually – the largest percentage increase, with terraced properties also enjoying house price growths of 15% over the year.

What does the house price boom mean for Leeds equity release potential?

The boom in house prices over the last decade means that Leeds homeowners have potentially hundreds of thousands of pounds of equity in their properties. So just how much equity can homeowners in Leeds unlock?

Homeowners aged 55+ can typically unlock between 20-60% of their property’s value with an equity release plan. Exactly how much depends on criteria such as their age (the older you are the more you can unlock), property type and location of their home.

Here, we take a look at how much equity a typical 71-year-old living in Leeds might have been able to free up from their home with an equity release plan over the last ten years:

(These are example figures based on a 71-year-old releasing 50% of the total value of their home with a standard plan. )

The 71 year-old we’ve based these figures on could potentially unlock £34,651 more than they could have done just five years ago. Better still, they could access a staggering £55,388 more tax-free cash than a decade ago, simply for living in their home.

Growth in the Leeds equity release market

With such large amounts of equity typically available, it’s easy to see why so many homeowners in Leeds are arranging equity release. 

The popularity of equity release in Leeds and across the North is clear from the Equity Release Council’s Autumn 2022 Market Report. 

According to the report, in 2021 almost one in five (18%) of new equity release plans were in Yorkshire and other northern regions. This compares to 11% in the whole of Wales, Scotland and Northern Ireland.

The same report shows that over the period 2017-2021 there was a 26% increase in the number of equity release plans arranged in Yorkshire. Clearly, demand for later life borrowing in the region is booming.

Do Leeds building society offer equity release?

You might be wondering if Leeds Building Society equity release plans are available – the answer is no, Leeds Building Society do not offer this type of retirement lending. They do however offer other types of mortgage products. 

Homeowners searching for a Leeds equity release company to help boost their retirement finances can call Equity Release Wise. Our team will be delighted to answer any initial questions you have about equity release. From there, they can connect you to one of our specialist equity release advisers to search for the best deals. 

If you’ve been looking for an equity release company in Leeds, you may be pleased to know that our selected advisers can help you to arrange a plan from the comfort of your own home. From the initial quotation search to the application and completion stage, they will guide you through every step of the process over the phone and by post.

Find out if you’re eligible for a plan and how much you could unlock by using our free online equity release calculator. Alternatively call us today on 0808 178 3055 or click here to request a free call back.

Will slowing house prices affect the Leeds equity release market?

Despite gloomy forecasts of a drop in house prices by as much as 10% in 2023, houses across Leeds and the rest of the UK are likely to remain far higher in value than what they were ten years ago. 

Early figures released in January 2023 by the Equity Release Council indicate that demand amongst homeowners did slow slightly in the last quarter of 2022. This is however more likely to do with September’s mini-Budget, rather than any forecasted drop in property prices.

Despite the slightly quieter end than expected to 2022, the equity release market is still twice the size that it was in 2017. 2022 was a record-breaking year for the industry, with 23% more customers year-on-year and a record £6.2billion released.

What will happen to house prices and the economy in the future is yet to be seen. For now, properties continue to be worth tens of thousands of pounds more than a decade ago. As a result, Leeds’ equity release customers potentially currently have access to far more tax-free equity than they would have been able to achieve just a few years ago

Extra flexibility adds to the popularity of equity release

Equity release plans have evolved significantly over the last decade. Today’s plans offer a number of helpful and innovative features that enable homeowners to:

• Guarantee an inheritance for their loved ones.

• Make voluntary partial repayments to reduce how much interest accrues.

• Prevent any interest from accruing with an interest-only plan.

• Unlock more money or lower interest rates if you have a qualifying health condition.

• Access tax-free cash from a second home or buy-to-let property.

With hundreds of modern plans now available together with more flexible features, Leeds equity release customers can enjoy far more choice than they would have done just a few short years ago.

Alternatives to equity release in Leeds

Of course, Leeds homeowners seeking a cash boost in retirement have other options than equity release to consider. For instance, downsizing is always discussed during the equity release advice process. For many people though, the prospect of selling the family home after many years of living there can be very distressing, especially if the homeowners have friends and relatives who live close by.

Thanks to equity release, Leeds homeowners in or approaching retirement can boost their later life finances without having to sell or move away from the home they love. 

Another option to consider is remortgaging. By extending the current mortgage deal or searching for a new one, homeowners can tap into their growing equity for a number of purposes. However, it does mean taking on or increasing the monthly repayments required by mortgage companies. 

With an equity release plan, there are no mandatory monthly repayments. Instead, the loan plus interest is repaid when the homeowner/s pass away or move into long-term care. 

Retirement interest only mortgages – or RIOs – are also worth a consideration. These work in much the same way as an equity release plan as they don’t have to be repaid until the plan holder passes away or moves into long-term care. However, there is interest to be paid each month in full for the entire duration of the loan. If the homeowner does not keep up with the monthly interest payments then they risk defaulting on their mortgage and potentially losing their home.

For those looking to pay off the interest each month on their loan, Leeds equity release customers can arrange flexible interest-only plans. Unlike a retirement interest only mortgage, the homeowner can stop making their monthly interest payments at any time. If they do so, the plan simply converts to a standard roll-up lifetime mortgage and no more monthly repayments are required. 

Find out more about Leeds equity release

Anybody thinking about unlocking some of their property wealth should seek the guidance of a qualified equity release adviser who is free to tell you if a plan is right for you or not.

The good news is, you don’t need to scour the internet for a reputable equity release company. Leeds homeowners can quickly and easily get in touch with the team at Equity Release Wise and our friendly team of selected advisers, who are specialists in equity release. Leeds homeowners can explore all their options, ask any questions you might have and gather the quotations needed without any pressure or obligation to proceed. 

In fact, you’ll only be charged a fee for advice if you choose to go ahead with your recommended plan. This is usually paid from the money that you unlock. 

Find out if you qualify for an equity release plan and how much you could release by speaking to Equity Release Wise today. Our selected advisers can search for the best deals for you in just a few minutes. Simply call us on 0808 178 3055 or request a call back for a time that suits you, and we’ll arrange an appointment. Alternatively, check your eligibility and get an initial indication of how much tax-free cash you could unlock.