A new Smith Institute Report ‘Making the Most of Equity Release: Perspectives from Key Players’ highlights the shortfall in adult social care funding and the resultant need to release housing wealth.
The expert authors of the report argue that equity release is growing and must form a larger part of the solution to this looming funding crisis.
The report shows that equity release can contribute towards the costs of social care but is misunderstood by homeowners and financial advisers.
The authors suggest a number of practical solutions to help the industry play a bigger role in funding social care, including:
- creating a single government department or minister responsible for supporting equity release;
- improving the quality of advice and fostering a greater degree of trust so that equity release becomes a major funding option;
- streamlining of the complex regulations around equity release;
- assisting banks in entering the equity release market;
- providing better integration between financial products and the benefits system;and
- incentivising the equity release industry to provide a greater set of suitable products.
“The report makes sensible recommendations which should be included in the forthcoming Social Care White Paper."
Andrea Rozario, director general of SHIP, agrees, saying that the Government should work with the industry to increase awareness of equity release.
“Housing wealth released through equity release is a largely untapped resource that can be used – without risking people’s right to remain in their homes – to give people the support and funding they need in later life,” she said.
“By working with the industry, Government can ensure that people have better access to independent information about equity release and that the industry is providing the right services to help meet the challenges of long term care funding for an ageing population.”
