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Equity release Equity release
Market
monitor
The Equity Release Market Monitor, published by Key Retirement
Solutions, reveals the latest figures on the performance of the equity
release sector
Growth in number of plans
K
ey Retirement’s Market
Monitor highlights how the
equity release sector has been
affected by both the recession
and developments within the
sector itself. The results for
quarter 2 of this year show a
drop in the number of new plans, down 24
per cent (Quarter 2 2009 – 5,143, Quarter 2
2008 – 6,747). The overall value of new
lending though experienced a more dramatic
result falling 41 per cent (Quarter 2 2009 -
£189 million, Quarter 2 2008, £319 million).
The wide ratio between plan numbers and
values stems from the drop in average loan
size. The average loan has fallen in value by
23 per cent from £52,820, Quarter 2 2008, to
£40,766 for the same period this year,
reflecting loan to value against reduced
property prices. But this is slightly misleading
as it shows the level of lower initial releases
from drawdown plans which have grown in
popularity. Equity release product split
Equity release continues to be used for a
range of purposes with Home Improvement
still being the most popular. Helping the
children out financially is now, for the first
time, the second most popular reason. The
Monitor also shows the diverse borrowing
trends by region where the difference in
average loan amount from the highest to the
lowest region is almost £50,000, and the
difference of average customer property value
is as high as £332,000.
September 2009 Mortgage Introducer
www.mortgageintroducer.com
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