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    LGEN   GB0005603997

LEGAL & GENERAL PLC

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Legal & General : Nearly half of homeowners in England and Wales could access more funds from property wealth than the average pension pot

11/24/2021 | 05:10am EST

Confidential

Legal & General Group Plc

23 November 2021

Embargoed until 00:01 Wednesday 24th November 2021

Nearly half of homeowners in England and Wales could access more funds from property wealth than the average pension pot

  • Homeowners in 53% of areas in England & Wales could be able to access more from the value of their home than is saved in the average pension pot (£61,930)
  • In March 2021, homeowners in England and Wales could release on average £72,988 worth of equity from their homes, an average increase of £14k in just five years due to a 24% increase in median house price values since 2016

Homeowners in 53% of areas in England and Wales could access more than the average pension pot (£61,930)1 by using equity release, according to analysis by Legal & General Home Finance (LGHF)of median local house price data from the Office for National Statistics (ONS).2

The most recently available ONS data outlining median house prices in England and Wales saw an average increase of 7.5% between March 2020 and March 2021 and of 24% between March 2016 and March 2021. Throughout 2021, house prices have increased even further.

Legal & General customers accessed, on average, 24.5% of the value of their home through equity release, putting the expected amount that can be accessed across England and Wales at £72,988. Due to the impact of the property boom, the average homeowner could access £5k more in 2021 than in 2020 and £14k more than five years earlier.

Ongoing house price growth has led many homeowners to consider the role their property might play in their long- term financial planning. One in seven pre-retired over 50s (16%) plan to use their property wealth to boost their finances via products like lifetime mortgages, a type of equity release, or via downsizing. However, an additional 13% said a significant increase in the value of their property could also convince them to do so.

While in previous years the highest increases were in high value areas of London, properties in Buckinghamshire Hertfordshire and Surrey were those that saw the most significant growth between 2020 and 2021. [Full table of areas with highest increases in Notes to Eds]

"In recent years, we have seen house prices increase to the extent that they will have become the most significant asset available to many UK homeowners. House prices have increased by an additional 11.8% over the year to September 2021, alone3.

"We anticipate that using your home to fund your retirement will become more commonplace, whether that's by downsizing to free up funds or releasing money tied up in your home through products like lifetime mortgages. This, in turn, can have a broader economic impact, with our data demonstrating that every £1 released via a lifetime mortgage can generate £2.34 of economic growth."

Claire Singleton, CEO, Legal & General Home Finance

-ENDS-

Legal & General Assurance Society Limited. Registered in England and Wales No. 00166055. Registered office: One Coleman Street, London EC2R 5AA. We are authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority.

Confidential

The information contained in this press release is intended solely for journalists and should not be relied upon by private investors or any other persons to make financial decisions.

  1. Refers to average pension pot of a pre-retired person over 50. Opinium survey of 2160 UK Over 50s in the UK who have not retired between the 9th and 13th August 2021
    2Office for National Statistics, House price statistics for small areas in England and Wales: year ending March 2021, Nov 2021
  1. Office for National Statistics, UK House Price Index: September 2021

Areas with the highest potential rise in average equity release available from March 2020 to March 2021

Median

Median

Difference in

equity

equity

average

release

release

equity

Median

available

Median

Local authority

based on

release

Ward name

house price

based on

house price

name

average L&G

available

(March 2020)

average L&G

(March 2021)

customer -

from March

customer -

24.5%

2020 to

24.5%

(March 2021)

March 2021

(March 2020)

Kensington and

Norland

£1,692,500

£414,663

£3,137,500

£768,688

£354,025

Chelsea

Hertsmere

Elstree

£453,000

£110,985

£930,000

£227,850

£116,865

Hertsmere

Aldenham East

£820,000

£200,900

£1,280,000

£313,600

£112,700

Shamley Green

Waverley

and Cranleigh

£647,000

£158,515

£1,101,111

£269,772

£111,257

North

Buckinghamshire

Hambleden

£690,000

£169,050

£1,015,000

£248,675

£79,625

Valley

Mole Valley

Westcott

£400,000

£98,000

£712,500

£174,563

£76,563

Kensington and

Campden

£1,945,000

£476,525

£2,250,000

£551,250

£74,725

Chelsea

Brent

Tokyngton

£188,000

£46,060

£482,500

£118,213

£72,153

Waverley

Blackheath and

£620,000

£151,900

£911,000

£223,195

£71,295

Wonersh

Haringey

Alexandra

£792,250

£194,101

£1,062,500

£260,313

£66,211

Areas with the highest potential rise in average equity release available from March 2016 to March 2021

Median

Median

Difference in

equity

equity

average

Median

release

Median

release

equity

Local authority

based on

based on

release

Ward name

house price

house price

name

average L&G

average L&G

available

(March 2016)

(March 2021)

customer -

customer -

from March

24.5% (March

24.5% (March

2016 to

2016)

2021)

March 2021

Kensington and

Norland

£1,720,000

£421,400

£3,137,500

£768,688

£347,288

Chelsea

Shamley Green

Waverley

and Cranleigh

£530,000

£129,850

£1,101,111

£269,772

£139,922

North

Hertsmere

Elstree

£375,000

£91,875

£930,000

£227,850

£135,975

Legal & General Assurance Society Limited. Registered in England and Wales No. 00166055. Registered office: One Coleman Street, London EC2R 5AA. We are authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority.

Confidential

Westminster

West End

£1,395,000

£341,775

£1,950,000

£477,750

£135,975

Kensington and

Royal Hospital

£1,500,000

£367,500

£2,012,500

£493,063

£125,563

Chelsea

Southwark

Dulwich Village

£1,000,000

£245,000

£1,487,500

£364,438

£119,438

Kensington and

Campden

£1,775,000

£434,875

£2,250,000

£551,250

£116,375

Chelsea

Hammersmith

Parsons Green

£920,000

£225,400

£1,350,000

£330,750

£105,350

and Fulham

and Walham

Brent

Queens Park

£725,000

£177,625

£1,150,000

£281,750

£104,125

Hertsmere

Aldenham East

£860,000

£210,700

£1,280,000

£313,600

£102,900

Notes to editors

About Legal & General

Established in 1836, Legal & General is one of the UK's leading financial services groups and a major global investor, with international businesses in the US, Europe, Middle East and Asia. With almost £1.3 trillion in total assets under management*, we are the UK's largest investment manager for corporate pension schemes and a UK market leader in pension risk transfer, alternative asset origination, life insurance, workplace pensions and retirement income. Through inclusive capitalism, we aim to build a better society by investing in long-term assets that benefit everyone.

* at 30 June 2021

About Legal & General Retail Retirement (LGRR)

Legal & General Retail Retirement's mission is to help its customers lead longer, healthier, happier lives. We believe everyone should be able to have a 'more colourful retirement'. The Division comprises the Group's retirement savings and income, later life lending and care solutions businesses. In 2020, LGRR wrote £910 million of annuity premiums and issued £791 million of lifetime and retirement interest only mortgages.

Lifetime mortgages are available to homeowners aged 55 or over and are a type of equity release that allows the customer to unlock some of the equity from their home without having to move. It's a loan secured against their home. If the customer gifts money away, the recipient may have to pay inheritance tax in the future. There may be cheaper ways to borrow money.

Further information

Name: Claire Byrd

Role: PR & Marketing Manager

Division: Legal & General Retail Retirement (LGRR)

Tel: + 44 7385 347 769

Email: Claire.Byrd@landg.com

Name: Lewis Wilks

Company: Lansons

Tel: + 44 7903 260 560

Email: lewisw@lansons.com

Legal & General Assurance Society Limited. Registered in England and Wales No. 00166055. Registered office: One Coleman Street, London EC2R 5AA. We are authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority.

Disclaimer

Legal & General Group plc published this content on 24 November 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 24 November 2021 10:09:06 UTC.


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