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SHIP: Equity release demand on the rise
21 July 2008 12:00
The amount of equity released from homes rose in the second quarter, according to new figures from the sector's trade body, reflecting the worsening pressures facing retirees.
A total of £275.7 million of equity was released over the past three months, data from Safer Home Income Plans (SHIP) showed, which was up by 14 per cent from the first quarter, with drawdown products now accounting for two out of every five plans sold.
Director general Andrea Rozario remarked that the sector remains strong in spite of the credit crunch, with the equity release market driven by an ageing population, falling pension contributions and the high levels of equity held in people's houses.
She explained that people's homes remain their most valuable assets despite recent price falls and attributed the recent rise in demand for equity from them to both the fear of further price decreases and the impact of the rising cost of living on retirees' incomes.
Commenting on SHIP's statistics, David Cooper from provider Just retirement stated that long-term demand for equity release is robust, with more people becoming aware of the positive contribution that these products can make to their retirements.
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