Mortgage lending to older borrowers jumped in the first quarter of this year, according to figures from a banking and finance industry body.
The figures from UK Finance provide a quarterly insight into mortgages taken out by borrowers over the age of 55, covering “mainstream” lending to older borrowers, as well as specialist products such as lifetime mortgages.
Some 38,510 new loans were advanced to older borrowers in the first quarter of this year, marking a 33.5% annual rise.
The value of this lending was £6.1 billion – a jump of more than two-fifths (42.6%) compared with the same quarter a year previously.
There were 5,620 new lifetime mortgages advanced in the first quarter of this year, up 11.1% year-on-year. The value of this lending was £530 million, which was up 39.5% compared with the same quarter a year previously.
There were 339 retirement interest only mortgages advanced in the first quarter, up 19.4% year-on-year.
The value of this lending was £33 million, which was up 17.9% compared with the same quarter a year previously.
Toby Leek, president of NAEA (National Association of Estate Agents) Propertymark said: “It is encouraging to see the mortgage landscape evolving and making better provision across the board, especially for people who are aged 50-plus.
“However, there are two sides to the coin to consider. This could also be down to underlying issues regarding the cost of living and how this might be impacting many older borrowers, specifically because they are having to delay paying off their mortgages until much later in life.
“In addition, shifts in consumer needs could also be down to factors such as higher interest rates and ever-increasing household bills making a substantial dent in affordability.”
Helen Morrissey, head of retirement analysis at Hargreaves Lansdown, said: “Over the long term, we can expect these figures to keep increasing.
“Rising house prices mean people are getting onto the property ladder later and taking longer mortgages, so even if everything in life goes to plan, they will be paying their mortgage beyond the age of 55.
“Some will be able to work later and use the extra cash to meet these outgoings, some will have windfalls during their working life to help pay off lump sums, but others face difficult retirement spending choices.”
