The equity release market has seen lenders cut rates since the start of this month. This is according to the latest figures from Moneyfacts.

Lifetime mortgage rates are falling, with the average rate reaching 7.13% since the start of this month, down from 7.33%. At the start of November 2022, the average rate stood at 8.13%, its highest on Moneyfacts’ records (electronic records began in November 2007).

The choice of deals stands at 312, significantly greater than at the start of this year (January 2023 – 179).

Several lenders have cut rates in their ranges since the start of November 2023. In terms of options, Legal & General Home Finance has over 80 deals available in its range.

Figures from the Equity Release Council for Q3 2023 saw customers unlock £716m of property wealth in total, the busiest quarter of 2023 so far for lending. This was up 8% from £663m in Q2 2023.

A majority of new customers have chosen drawdown (53%) over a lump sum option, according to the Equity Release Council.

Moneyfactscompare.co.uk finance expert Rachel Springall comments: ““According to a recent report from the Equity Release Council, Q3 2023 was the busiest quarter so far this year for lending. The report also revealed that 53% of new customers opted for drawdown lifetime mortgages during the same quarter|”.

“As interest rates have been volatile year-on-year, it’s not too surprising to see a slight preference for this option versus taking a lump sum, particularly as the average equity release rate stood at a record high of 8.13% in November 2022 . A drawdown option may be more enticing for homeowners who only need to release a small portion of wealth when they need, which will mitigate incurred interest”.