Drawdown equity release sales surged 11% in Q1 2012 to account for 66% of all equity release deals, Key Retirement Solutions data reveals.
This is up 11% from the 55% share of all deals sold that drawdown products accounted for over the whole of 2011.
Total lending rose 1.7% from £213.48m in Q1 2011 to £217.1m in Q1 2012 and plan sales rose 6.4% to 4,508 in the three months compared with 4,237 for the same period of 2011.
Growth in plan sales was nearly four times faster than growth in total lending underlying how increasing use of drawdown is driving growth across the equity release market – KRS’ figures show £83.8m of drawdown funds was not used in the quarter.
Dean Mirfin, group director at KRS, says: “We were critical in January that not enough was being done to promote drawdown.
“Even representing 66% of all equity release business completed over the quarter it’s still not where it should be but it’s a hell of an improvement.”
Home and garden improvements remained the most popular use of equity release cash – 57% of customers used some or all of the cash for that with 33% using money to clear debts and 31% to help fund holidays.
Across the country six out of 12 regions saw growth in the total number of plans sold with the North seeing growth of 65% and the East Midlands 53%. Wales saw a 13% fall in sales.
The biggest growth in total value released was in London where total value increased by 45.7% while the East Midlands saw totals climb by 43.7%. In total four out of 12 regions saw increases