What Is a Home Reversion Plan?
A home reversion plan is one of the two types of equity release product. It involves selling a share — or all — of your home to a specialist provider in return for a cash lump sum, while retaining the right to live in the property rent-free for the rest of your life.
You sell a share of your property for a lump sum (typically 20–60% of its market value), keep the right to live there rent-free, and when the property is sold the provider takes their share. You no longer own 100% of the property.
How a home reversion plan works
When you enter a home reversion plan, you legally sell a percentage of your property to the reversion provider. In return, you receive a cash sum — but not the full open market value of the share sold. Because you retain the right to live in the property rent-free for life (potentially many years), the provider discounts the purchase price to reflect the deferred nature of their return. The younger you are, the larger the discount — at 65, you might receive as little as 20–30% of the share's market value. At 85, you might receive 50–60%.
The arrangement is recorded at HM Land Registry. The provider becomes a co-owner of the property. When the property is eventually sold — on your death or move to care — the proceeds are split according to the respective ownership shares.
How it compares to a lifetime mortgage
The key difference is ownership. With a lifetime mortgage, you retain full ownership of your property and take a loan against it. The loan grows with compound interest, but the underlying property ownership does not change. With a home reversion plan, you permanently sell part of the property — there is no loan, no compound interest, but you no longer own the full asset.
If property values rise significantly over the life of the plan, a home reversion plan is disadvantageous compared to a lifetime mortgage: the provider benefits from the full rise in value of the share they purchased cheaply. If property values stagnate or fall, the home reversion structure may prove relatively more favourable.
Availability and minimum age
Home reversion plans are significantly less common than lifetime mortgages. Very few providers currently offer them in the UK market, compared to the wide range of lifetime mortgage lenders. The minimum age for home reversion plans is typically 65, compared to 55 for lifetime mortgages — making them inaccessible to younger equity release applicants.
Because of the limited provider market and the complexity of the ownership arrangements, specialist advice is particularly important for anyone considering a home reversion plan.
Protecting a remaining share for your estate
It is possible to sell only a portion of the property — for example, 50% — and retain the other 50% in your ownership. This means your estate still benefits from any property value appreciation on the retained share. If you sell 50% and the property doubles in value, your estate receives 50% of the doubled value — not nothing. Many home reversion customers choose to sell less than 100% for exactly this reason.
Reviewed by Chris, CII-qualified equity release specialist · Last reviewed July 2026
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