Nearly 8,000 new equity release plans were sold in the first quarter of 2005 with a value of £376 million, the second highest quarter on record and an increase of 38.75 per cent over quarter one 2004.
The figures revealed a continuation of the record growth trend experienced at the end of 2004 when both quarter three and quarter four produced over £370 million in sales.
The monitor suggested that a key reason for the increase was the new levels of confidence inspired by mortgage regulation as well as the increasing numbers of over 65s looking to supplement their retirement income.
According to the monitor the average age of an equity release borrower is 71 years old, up from 70 in quarter four 2004.
The loan-to-value ratio continues to be held at 24 per cent but the typical amount of release dropped to £45,685 (£47,683 in quarter four) on a £193,117 (£194,925 in quarter four) property.
Dean Mirfin, business development director at Key Retirement Solutions, said: “The fact that equity release activity is highest in cities as widespread as Brighton and Sheffield shows that the popularity of the product is not confined geographically but has wide appeal to equity-rich ‘middle Englanders.”
Nigel Spencer, head of marketing at Norwich Union Equity Release, said: “Business volumes are strong, enquiries and demand are increasing.
“This is mainly due to the launch of our home reversion plan and we believe that having a strong branded name will further fuel the market.”
