People’s attitudes to their own properties have changed as a result of the recession – potentially leading to rising demand for equity release.
A joint study from insurer Aviva and Dr Paul Keedwell, expert in environmental psychology at Cardiff University, suggested that 68 per cent see their homes as an "emotional investment" instead of a "commodity".
The research also calculated the Emotional Added Value (EAV) that people held in the properties, through measuring the value of the memories and milestones that had been experienced in the homes as well as their actual market prices.
According to Dr Keedwell, the typical person has an EAV of £26,880.
He added: "A surprisingly large number of people across the UK … report having a new-found emotional attachment to their homes.
"This is probably because of, rather than in spite of, the economic downturn, which has made many of us change from being house hoppers to house stoppers."
A willingness to stay put in a paid-for property could also improve sentiment towards equity release plans, which provide income through unlocking the value already built up in a home.
Figures from Key Retirement Solutions show that the number of plans taken out by customers rose by 19 per cent from the second to the third quarter.
Posted by Richard Planner
