According to market analysis by Key Retirement Solutions (KRS) 101,600 equity release plans were outstanding at the end of quarter two 2005.
The total number of plans in the quarter taken out via Safe Home Income Plan (SHIP) members – who represent 90 per cent of the market – and non-SHIP prov-iders in the three months to June 2005 were 6,292, up 8.58 per cent on the previous quarter. However, the value of plans taken out fell to £265 million from £277 million in quarter one 2005.
Dean Mirfin, business development manager at KRS, explained that equity release is becoming an increasingly mainstream financial product with approximately one household in every 40 that is headed by a consumer over 65 currently using equity release.
He said: “The growth reflects the fact that consumer confidence in equity release products has grown post-FSA regulation and, with the wider range of products, consumers have more options to choose from. This quarter saw the number of current equity release plans break through the 100,000 barrier for the first time.”
“Quarter-on-quarter the number of plans sold increased although the value of plans fell. We believe this is due to more people using equity release but, as a result of slowing house prices, releasing lower amounts of equity,” Mirfin added.
Brenden Kearns, group proposition development manger at Norwich Union Personal Finance, said: “We agree with these estimated figures released by KRS.
“Norwich Union has seen the phenomenal growth of equity release first hand and consider ourselves a key driving force. We have great expectations that there will be a similar drive in the home reversion market.”
