If you own a house and need cash without moving right away, home reversion could be an option. In a home reversion deal you sell a part (or sometimes all) of your property to a specialist company. You keep the right to live in the house for the rest of your life, or for a set period, and the buyer gets a share of the property's future value.
Think of it as a reverse mortgage, but instead of borrowing money against the equity, you actually sell a slice of the equity. The money you receive is usually a fraction of the current market value – the exact percentage depends on your age, the house’s price, and the terms you agree on.
First, a specialist valuation determines how much your home is worth today. Then the provider offers you a percentage of that value – often between 20% and 50% – as a lump‑sum payment or a regular income. You stay in the house, paying any maintenance, council tax, and utilities as usual.
When you pass away or move out permanently, the provider sells the property and takes back the share they own. If the house has gone up in value, the provider gains more; if it’s dropped, they get less. This means the deal can be a good fit if you need cash now and are comfortable with the future impact on your estate.
Home reversion is different from a standard equity release loan because you don’t have to repay anything. The repayment is built into the eventual sale. You also don’t have to worry about interest rates climbing over time, which can happen with some remortgage products.
Look at your long‑term plans. If you intend to leave the house to your children, a home reversion deal will reduce the inheritance they receive. Compare the lump‑sum offer with other options like a traditional remortgage, a cash‑in‑cash‑out equity release, or even selling the whole property.
Check the provider’s reputation. Some companies charge high fees or have strict rules about when you can move out. Read the fine print on maintenance responsibilities, any rent you might have to pay, and what happens if you need to move into care.
Make sure you get independent advice. A qualified financial adviser can run the numbers and show you the net effect on your estate. Often, a quick look at the pull equity article on our site helps you see if taking cash out now makes sense compared to a home reversion deal.
Finally, think about the market. Property values can swing. If you think your area will see strong growth, selling a share now could cost you later. On the other hand, if the market is flat or dropping, locking in a guaranteed cash amount might be reassuring.
Home reversion isn’t for everyone, but it can give older homeowners a steady income without forcing an immediate move. Use the points above to weigh the pros and cons, talk to a trusted adviser, and decide if swapping a slice of your home for cash fits your future plans.
Equity release lets homeowners unlock cash from their property, but it isn’t all sunshine and rainbows. This article cuts through the sales pitches to explain what equity release actually means, who benefits, and what you could lose. We cover the main catches, from interest charges to shrinking inheritance. Real-life tips and eye-opening facts will help you figure out if this is your best move—without any sugar coating.