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Will older home-owners use equity release to improve the quality of their lives?
- Authors:
- TERRY Rachel, GIBSON Richard
- Journal article citation:
- Housing Care and Support, 13(1), February 2010, pp.28-32.
- Publisher:
- Emerald
Older people often prefer to be supported in order to remain in their own homes, but are often unable to afford the type of help they want. If income-poor, but asset rich older home-owners could draw on their housing equity easily, then they could afford the practical help (such as window cleaning and gardening) that would improve their quality of life and make it possible for them to continue to live for longer in their own homes. However, there are deterrents to using equity release, such as reluctance to reduce inheritance, anxiety over whether drawing on this equity is value for money, and concern that it might mean a reduction in their entitlements. The schemes that have been drawn up address all of the above concerns, and the pricing is more favourable than any alternative – although the interest rates are similar, there are significantly reduced fees. This article reports on three local authorities (the London Borough of Islington, the Royal Borough of Kensington & Chelsea, and the Borough of Maidstone) that are now piloting equity release schemes, and the plans for monitoring and assessing them.
Obstacles to equity release
- Authors:
- TERRY Rachel, GIBSON Richard
- Publisher:
- Joseph Rowntree Foundation
- Publication year:
- 2006
- Pagination:
- 59p.
- Place of publication:
- York
Over two million older home owners have housing assets worth over £50,000 but incomes so low that they qualify for means-tested benefits. Drawing on housing equity could improve their quality of life significantly, helping them to live more comfortably in their own homes for longer. But only around 25,000 home owners (of all incomes) conclude equity release deals each year. This study by Rachel Terry and Richard Gibson identifies the obstacles to older home owners with relatively low incomes releasing housing equity and suggests ways of overcoming them. The study focuses on funding home improvements and repairs, and additional care at home.