MI_32-33_equity release.qxd 22/1/09 15:43 Page 2
32 | Equity release
Prepare
for the
unexpected
Bridgewater's Alison Beeston believes
that we can only move on by reviewing
what has come before. So here is a look
back at 2008
s the saying goes, that was the income and rising costs. Add to this the gradual
A
year that was, and it's fair to say realisation of the long-term problems facing
that no-one is going to forget the UK on funding of care for the elderly – it
2008 in a hurry, particularly the has been recently mooted that there is a short-
financial services market and all fall of £6 billion a year already to meet the
who work in her. It is with a needs of the UK's older generation in this area.
certain degree of trepidation Put this in the context of the UK in recession,
that one looks back over the last 12 months; it house-building at a standstill and unemploy-
is tempting to think that 'what's done is done' ment on a seemingly inexorable rise to two
and we should focus on what is in front of us. million-plus, and it looks extremely dismal.
However, we can only learn and move on by The reputation of equity release as a product
reviewing what has come before; this is just as solution has not always been what it should,
true in the equity release sector as anywhere however, for the first time we had a former
else government minister, David Blunkett, extolling
So to 2008 - what did it mean for the equity the virtues of the product as a way to meet the
release market? On a particularly positive note needs of an aging population. That said, the
there is much to be said for equity release; recently published Which? report shows that
indeed, as a sector it showed more resistance to the sector's reputation is still not what it should
the credit crunch and financial crisis than most be and there is much work to be done to
other areas. At a time which could often be update opinions and educate the public at
described as chaotic we saw levels of business large. SHIP did well to discredit this report
transactions just about matching 2007 levels – pointing out the fact that the report largely
no mean achievement when we consider the rehashed old viewpoints about equity release
downward trends across other sectors. and was out-of-date in many areas and we advisers
Of course many would argue that now is the should not let this one report detract us from now active-
time when equity release should be coming the overall aim of increasing the reputation of ly working in
into its own as we see an increase in 'equity the products. On a positive note though, con- the sector as they
rich, cash poor' individuals through growing sumers' access to specialist equity release advice consider the need for
uncertainty with regard to pension and savings may have grown with a significant number of greater diversification.
February 2009 Mortgage Introducer
www.mortgageintroducer.com
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