With the end of Help to Buy looming, Air is urging advisers to speak to their clients about equity release in order to support the aspirations of younger relatives.
Amidst current market uncertainty, the 31st of October deadline to submit new applications for the Government’s Help to Buy scheme could not come at a worse time.
Even applicants who have already applied must meet the 31st of March 2023 completion deadline and are expected to have the keys to their home by 6pm that day to be eligible for an equity loan.
Stuart Wilson, CEO of Air, is today urging advisers to ensure that their clients realise that equity release is an option if their younger relatives miss the Government’s Help to Buy deadline.
Wilson said: “While there is no doubt taking your first steps onto the property ladder at the moment is likely to be daunting, the end of October deadline is going to force people to either commit to buying something before March or miss this government support.
“The changes to the Stamp Duty thresholds will no doubt help to mitigate this for some, but the fact remains that others will miss out and need to consider either putting off their dream or looking for additional help.
“Industry data suggests that one in five equity release customers use some or all of the proceeds of their withdrawal to support younger relatives, so advisers need to help clients understand that there is a potential lifeline.”
With buyers who utilise this scheme needing to find a deposit that is equal to 5% of the full purchase price of the property, Air wants to support advisers in proving equity release as a viable option, as it can also help people to secure this deposit amount and therefore qualify for the scheme.
With the equity release market on track to hit over £6bn in 2022 and figures suggesting that one in five customers uses equity release to provide some support for wider family, it is clear that the market presents a real opportunity for help to those wishing to take those first daunting steps onto the property ladder.
Wilson added: “Naturally, older people need to carefully consider the impact on their own finances which are also likely to be under pressure.
“But getting specialist advice is vitally important as it will help people to fully understand their options and make the right choices for their individual circumstances.”
