NEARLY a quarter of homeowners in Scotland would consider using equity release to unlock cash secured in their houses, according to new research.

A report by Legal & General revealed 23 per cent of homeowners in Scotland had released equity from their homes or had considered doing so in the past or future.

The survey of more than 2500 customers found cash accessed by equity release supports gross output by up to £7.1 billion in the UK.

The report found lifetime mortgages – a type of equity release – have seen a surge in popularity with the UK’s older homeowners in recent years, becoming the fastest growing sector of the mortgage market. Lifetime mortgage sales tripled between 2013 and 2017, rising from just over £1bn to more than £3bn in 2017, according to the Equity Release Council.

The research analyses the current direct, indirect and induced impact of the equity released from homeowners’ properties on the UK economy and specific industries.

It found for every £1 of housing wealth accessed through equity release products, £2.34 is generated for the UK’s economy.

Breaking down the direct economic impact industry by industry, manufacturing benefits the most from equity release spending by £1.34bn, whilst the construction sector benefits from £349 million – the equivalent annual salaries of 14,000 construction workers or 11,400 electricians. Health and social work was also supported by equity release spending. The sector was boosted by £203m, which is the equivalent of 7500 nurses, 3200 doctors or 9600 community workers.

When analysing the number of jobs created by equity release spending, the research found equity release supports 37,100 jobs directly and indirectly across the UK. This is likely to grow significantly over time.

In Scotland, nearly half of respondents (46 per cent) said they would use their released equity for home refurbishments and more than a quarter (28 per cent) to pay for a holiday. Close to a fifth (18 per cent) would use the money to buy a new vehicle.

Only three per cent of homeowners in the UK said they had released equity, yet 18 per cent said they would consider accessing their housing wealth via a lifetime mortgage in the future and a further three per cent said they had considered doing so in the past. The means almost a quarter (24 per cent) of UK homeowners, or 3.4m households are open to the idea of accessing their property wealth in retirement.

Newly released figures now show that Legal & General Home Finance wrote £1bn in lifetime mortgage advances last year.

Chris Knight, CEO of Legal & General, said: “It’s no secret that lifetime mortgages have been growing in popularity in recent years, but as more and more Britons decide to access the cash tied up in their homes for retirement, no one has yet asked the question about the impact this newly unlocked equity is having on our economy.

“Our Silver Spenders research shows that homeowners aged over 55 are boosting UK gross output by up to £7.1bn, with the benefits being felt across industries ranging from construction and manufacturing to health and social services. Not only are these older homeowners accessing equity that would otherwise have remained locked up in their properties, whether for a holiday or a home renovation, but these funds are filtering through the economy as well.”