Equity Release goes from strength to strength
Q3 saw equity release reach its highest level of lending since the start of 2010 after a 12 per cent rise in advances, according to figures from Safe Home Income Plans (SHIP) members.
SHIP members account for 90 per cent of the equity release market and have experienced advances of £206.2 million in Q3. This is an increase of £21.3 million against Q2 activity.
This increase is a culmination of two things; a rise in equity release customers and an increase in the average equity released.
There were 3,710 customers taking out an equity release plan in Q2. This figure jumped to 4,148 for Q3 and whilst the average amount released in Q3 was marginally when compared to Q2, it was however up 6 per cent year-on-year.
The rise of inflation, the onset of winter bringing with it increased heating bills and inadequate pensions and savings are the likeliest contributors to equity releases’ increase in popularity.
Given the nature of this product, intermediaries rightly retain the majority share of the market; 88 per cent of new business coming via this channel.
Andrea Rozario is the Director-General of SHIP:
“This has been an excellent quarter for the equity release market. We feel that breaking the psychologically-important £200m barrier for new advances in Q3 is fantastic news for an industry that is recognised to have a huge latent demand.”¹
Rozario is confident the market will continue in this positive direction:
“The UK population is ageing and with insufficient pension provision and the prospect of meeting significant care costs, we expect demand for equity release products to increase significantly over the next few years.”¹
Content correct at time of publication