Knight Frank expands into later life lending
Estate agent, Knight Frank, will offer a range of products for older homeowners which include equity release and retirement interest only (RIO) mortgages
Knight Frank Finance, which is part of a global real estate group, will be offering a range of products for older homeowners which include equity release and retirement interest only (RIO) mortgages.
The products will be launched through Knight Frank’s later life finance team, which will also provide advice for those who need a short-term solution to help downsize or buy a retirement home.
David Forsdyke of Knight Frank Finance, said over-55s held the majority – around 75% – of all property wealth in the UK. He added that they are seeing older people look to release equity from their primary residence for a number of reasons, including helping children financially, making home improvements and enhancing their quality of living, or to take the holiday of a lifetime.
At the same time, there has been a steady decline in pensions and savings with retired people in the UK often finding themselves asset rich, but cash poor, he said.
Knight Frank said it was the first major player in the property sector to offer a later life service to the over-55s.
The popularity of equity release has soared in recent years, with the rise of the Bank of Mum and Dad – or ‘Bank of Grandma and Grandad’ – playing a major role in fuelling this growth.
Indeed, figures from equity release lender, OneFamily, revealed homeowners using a lifetime mortgage to support a loved one were releasing over £110,000. In only a year this figure has risen by 28%, with just over £85,000 being released on average in 2018.
Jason Ruse, head of equity release referral company, Key Partnerships, said Knight Frank’s offering was a positive development for the equity release market as it would enable more customers to access these products.
He also said it highlighted to other estate agents the potential in this market. Indeed, it revealed, it received some of its referrals from customers interested in later life lending from estate agents.
He added that they working to further educate estate agents to the opportunities in the market as equity release can not only be used to help the younger generation with much needed first time buyer deposits but it can also be used by existing home owners to help with their next house purchase.