Explosive growth is imminent in the equity release sector, according to Safe Home Income Plans.
This prediction comes despite a recent report from the Council of Mortgage Lenders which highlights the slow growth of the equity release market in the UK compared with the US, Australia and New Zealand.
SHIP insists the UK equity release sector will thrive because consumers will increasingly opt for property over traditional pension plans as their source of retirement income. They will also benefit from the improved quality of equity release schemes.
Andrea Rozario, director-general of SHIP, says: “Declining private pension provision and meagre state pensions will drive more individuals to explore alternative ways to top up their in-come in later life.
“All that is necessary for this sector to grow enormously in size is for consumers and opinion formers to recognise the improvements that have been made to equity release schemes.”
Rozario and the CML agree growth in the equity release market would be accelerated by a rise in the number of providers and particularly the entry of prominent lenders such as Coventry through its specialist lender Godiva.
Meanwhile, Rozario says SHIP will launch a range of initiatives to boost consumer-focussed growth and liaise with the government to spread the word about the value of equity release.
Tom Moloney, operations and sales manager at NHFA, says: “What we need is a high street bank to put money into the equity release sector and for the government to stop whispering and start yelling about its benefits.”