However for the year as a whole the value of new business was down 6.8% on twelve months ago.
The report showed that the total value of new business written for Q3 2008 reached £303.3m, a £27.6m (10%) increase on the amount released in the previous quarter. 7,942 new policies were sold in Q3, significantly up (15.7%) on last quarter's figure of 6,864.
The total value of new business written was down slightly by 6.8% (£22m) on the previous year's figure, but the number of new policies sold remained stable against that of the previous year (7,981 policies sold in Q3 2007).
Sales via intermediaries rose by a significant 16.43% quarter on quarter, from £194.7m (Q2) to £226.7m (Q3). Direct sales continue to represent a smaller share of the whole market (£76.5m), a figure which has remained largely stable, (Q3 2007: £74.8m, Q2 2008: £81m).
Lump Sum Mortgages show greatest quarterly growth:
The value of equity released as a lump sum has grown 16.4% from £145.2m in Q2 to £169m in Q3. Annual comparisons show a slight decline of 6.1% (from £180.9m in Q3 2007).
Popularity Of Drawdown Continues:
The popularity of drawdown products has shown continued growth and accounted for 57.6% of all plans sold in Q3, a quarterly increase of 4.7% (Q2 2008: 52.9%).
The amount committed by drawdown schemes in Q3 was £218.9m, and the amount advanced by drawdown stood at £118.4m. These figures show quarter on quarter growth of 6.46% and 1.71% respectively.
Drawdown products have become increasingly popular, due to their flexible nature: year on year, the number of drawdown products sold in Q3 has increased 12% to 4,577 (Q3 2007: 4,088).
Andrea Rozario, Director General of SHIP, commented: "The equity release market has been naturally affected by the slowdown in the wider property market. However, whilst the volume figures are slightly down on the previous year the equity release market as a whole is holding its own and the number of actual plans sold is stable. The increase in popularity of drawdown products, which allow people to take a small sum initially with the option to get at more if they should need it, will obviously impact on the volume of business written and this is also reflected in the figures.
"The overall stability of the market in such turbulent financial times is very pleasing. Quarter on quarter growth has been strong, especially in terms of the number and value of drawdown products taken out. Equity release remains an important diversification of an adviser's client offering, and the 16.4% rise in sales through intermediaries shows good growth.
"There remains a clear need for equity release products, which is becoming ever more important as pensioners feel the pinch from the credit crunch. We remain realistic and yet positive about the next quarter's results".
