The average value of the amount borrowed in the capital increased by 39% year-on-year, whilst the average case increased by 33%
Over the first quarter of 2021 there has been a 123% increase in house purchases, according to Equity Release Supermarket (ERS).
The rise in the number of house purchases was also reported along with a rise in the purchases of second homes, which increased by 17% compared to the first quarter of last year.
As well as this, 59% more customers have gifted some of their funds to their children compared to the same period in 2020.
The average value of the amount borrowed in the capital increased by 39% year-on-year, whilst the average case increased by 33%.
Sales across the southern region of the UK witnessed a notable rise in comparison to last year.
London, the South East and the South West all accounted for 52% of sales in the first quarter of this year, as well as 64% by value, an increase of 11% compared to the same period in 2020.
In comparison to the first quarter of last year, utilising money borrowed to repay debts dropped by 41%.
Mark Gregory, founder and chief executive at Equity Release Supermarket, said: Findings on the usage of funds is probably as you would expect given the advantages of the stamp duty holiday, helping those looking to get on, or move up the property ladder.
Whilst the government backed mortgage scheme, which launched mid-April, offering first time buyers 95% LTV mortgages is welcomed, even a modest £10,000 deposit on a £200,000 property is a significant amount of money for those who have been unable to start saving, he said. This also doesn’t help or support those who already own a property and are looking to upscale or move up the ladder.
Rightmove reported a 2.1% increase in house prices in April, up to a record house price average of £327,797 – hence, the shortage of property on the market is really driving up these prices, Gregory said.
He said high-net-worth property owners taking advantage of low interest rates and the flexibility that many lifetime mortgages now offer, such as fixed term early repayments charges, have also driven the higher case values reported across London.