Our first Equity Release Survey reveals a growing awareness of the sector’s products and that perceptions are improving through younger generations.
The Equity Release sector has experienced substantial growth in recent years. Homeowners took out more than 45,000 equity release plans during the year to Q1 2020, up 16% on the same period two years earlier, according to Equity Release Council data.
Factors driving that growth vary, spanning from pension shortfalls and a growing desire to help relatives unable to get a foot on the housing ladder, to a rapidly improving choice of products and increasingly diverse use of equity in later life.
Greater scrutiny has understandably accompanied that growth, and some scepticism lingers following the limited advice and poor product choice that prevailed two decades ago. Much progress has been made since. Product providers and advisors have been regulated by the FCA since 2004, and the majority of the industry has signed up to Equity Release Council standards.
Even so, it’s clear common misconceptions persist, and there is still more to do to effectively share information at scale.
To better understand consumers’ views of the equity release market, both positive and negative, we conducted a survey with consumers of all ages during July. We constantly strive to improve the information and advice we give to homeowners, and the survey lays bare where the most work needs to be done, and which misconceptions still need to be addressed.
There are many positives to be gleaned from the responses. Perceptions improve through younger generations and it’s becoming increasingly clear that property wealth is likely to form an integral part of financial planning in years to come.
Knight Frank Finance research reveals older homeowners have accrued £3.1 trillion in property wealth following decades of house price growth, and the survey indicates a fifth of consumers plan to take a proactive approach to accessing that wealth should they need it. We expect growth in the sector to continue, particularly while rates remain close to record lows, whether that's among homeowners seeking to plug a pensions shortfall, to repay existing debts, or to help family members get a foot on the housing ladder.
If you'd like to find out more about equity release or discuss your own requirements, do get in touch.