Around 29,060 new loans had been superior to older debtors in This autumn, a lower of 37 per cent year-on-year (YOY), with whole lending coming to £4.1bn.
According to UK Finance, the latter is down 42 per cent in comparison with the identical interval final 12 months.
The report continued on to say that there have been 6,710 new lifetime mortgages, a lower of 40 per cent in comparison with the identical interval final 12 months.
The worth of lifetime mortgage lending stood at £520m, which is down from 57 per cent in comparison with This autumn 2022.
In This autumn 2023, there have been 222 retirement interest-only (RIO) mortgages superior in This autumn, down 43.3 per cent YOY.
The worth of RIO lending got here to £26m, a fall of 38 per cent on the identical quarter final 12 months.
The residential later life loans in This autumn made up 7.4 per cent of all residential loans, and buy-to-let (BTL) later life loans accounted for round 22 per cent of all BTL loans.
Later life lending figures according to expectations
Jim Boyd, CEO of the Equity Release Council (ERC), mentioned: “Today’s later life lending figures from UK Finance echo the challenges that we have now seen throughout all residential property markets, together with fairness launch. Rising rates of interest noticed exercise gradual in 2023, with clients and their advisers taking a cautious method to borrowing and laying aside a lot of these greater selections.
“However, anecdotal proof means that we have now seen a extra constructive begin to 2024 as clients contemplate their choices and begin to acclimatise to the present higher-interest-rate surroundings. Many persons are counting on their property wealth to retire in consolation, and we’re targeted on guaranteeing they will access it confidently and securely.
“Whether the customer wishes to top up their pension, support their family or manage their borrowing in retirement, today’s products offer more flexible options to help manage costs, with voluntary repayments baked into every new plan. Ultimately, it is about choice, and it is vital that people plan carefully for the future and only commit to long-term products after careful consideration, expert advice and consulting with loved ones.”
Paul Saroya, director at Viva Retirement Solutions, mentioned that the info disclosed was “very much in line with expectations in the market”.
“The mini Budget has had a prolonged impact on the market and, although we hope for growth this year, it very much depends on many external factors. What we do know is that the pent-up demand is building and that the market will surpass previous “best” ranges, we simply have no idea when,” he defined.
Simon Webb, managing director of capital markets and finance at LiveMore, mentioned that the figures had been “indicative of our still-turbulent market” as, regardless of an ageing inhabitants and improved product selection, there was nonetheless a pointy drop in loans.
“That said, borrowing was unusually high following the 23 September 2022 stamp duty increase to thresholds, when the over-55s realised they could tap into the equity in their property,” he famous.
Webb continued: “When we see a lot of these figures, it rings alarm bells in regards to the potential rising variety of mortgage prisoners within the UK. Interest-only mortgages can assist mortgage prisoners who can’t meet affordability standards, in addition to these with interest-only mortgages as a consequence of mature however with no compensation plan in place.
“Without suitable products, these two groups of customers would otherwise have to sell up or pay very high interest rates.”
Anna is a reporter for Mortgage Solutions and assistant editor for Specialist Lending Solutions, each B2B sister titles of YourMoney.com. She has labored as a journalist for over 4 years, initially within the specialty insurance coverage sector earlier than shifting onto mortgages.
