A quarter of people planning to release equity in the next six months are in London
Almost two thirds of those who have released equity in the last six months have their mortgage up for renewal in the next two years
Almost a third of millennials plan to release equity from their property in the next six months
Economic uncertainty and high London property prices are driving the release of capital, according to data released today.
A recent survey by UK law firm Michelmores of affluent millennials, Gen X and baby boomers found that 16% of respondents have released equity from property in the last six months, with another 17% stating an intention to do so in the next 6 months.
44% of those who have released equity from their property in the last six months live in London where prices remain well above the national average. The greatest proportion of those saying they’ll release equity in the next six months are also in London (24%).
When asked why they had released equity from their property, many respondents stated that increased cost of living or inflation was a factor and they wanted ‘money in the bank’, while others needed the cash for renovations or repairs. Several had released equity to allow them to buy a new property.
Stevie Wilson, Associate at Michelmores says:
“The data suggests that many view now as a good time to take equity out of their properties to either renovate existing property or invest in additional properties – further evidencing that traditional property investment is viewed as ‘safe’ in the current climate.
“A sensible approach will be to look at the areas of London most likely to grow in value over the coming years, such as those with established regeneration plans or based along key transport routes such as the new Elizabeth line.”
Those with shared ownership of their property are significantly more likely to have either released equity in the last six months (41%) or are planning to release equity in the next six months (47%) indicating a high correlation here with the cost of property in the capital.
60% of those who have released equity in the last six months have their mortgage up for renewal in the next two years. This high level of short-term contracts might reflect high interest rates and a desire for flexibility amid ongoing uncertainty.
James Frampton, Partner at UK law firm Michelmores, added:
“Despite much negative press, the mortgage market isn’t currently as bleak as it may appear. It is prudent to speak to your financial advisor who can assess the bigger picture in terms of assets held and cash required and advise on the most suitable products and terms.”
