Equity release set to grow
Equity release specialist, Safe Home Income Plans (SHIP), is predicting significant growth in the UK equity release market.
The firm believes that the large number of consumers who have opted for property investment as a means of providing pension income gives a sound indication that the market is set to expand.
Equity release can enable people above a certain age, who are asset rich but cash poor, to increase retirement income by releasing some of the value of their homes.
The Council of Mortgage Lenders (CML) has recently issued a report on the UK equity release market, examining why the market in the UK has grown at a much slower rate than in countries such as the USA, Australia and New Zealand.
The research found that growth in markets overseas could be attributed to Government guarantees and social considerations.
For example, in Australasia younger households are more comfortable drawing on their housing assets and less concerned about inheritance.
The CML is calling on the Government to engender consumer confidence in the UK equity release market, and for the industry itself to provide new and creative ideas about how to move forward.
The report’s author, Peter Williams, says: “Looking at the wider context it is clear that equity release will continue to grow.”
Andrea Rozario, Director General of SHIP says: “The reality is that declining levels of private pension provision and meagre state pension benefits will drive more people in this country to explore alternative ways to top up their income in later life. Some will work longer, but a very large number are already planning to use the value in their property.”
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