Typically, equity release was seen as a product that people opted for more as a last resort rather than out of choice, but that could all change according to the latest news from Safe Home Income Plan or SHIP. They suggest that equity release could soon be considered a mainstream financial product in times to come. Perhaps they are not far off the truth as a home represents most people’s largest asset. 

According to SHIP the equity release market has reported a 1.2% increase in market value at the end of Q3, however the number of equity release customers actually dropped by 2.5% across the industry during this period. The quarter saw the average amount released by equity release actually grow by almost 4% from £43,746 (Q2’09) to £45,434 (Q3’09), which is certainly a positive sign for the industry.

When one looks at the big picture the equity release market has taken a tumble over the last year with a reported year on year decline of 22%. To make matters worse customer numbers have declined considerably by around 35% in one year. However, consolation must be taken by the fact that it has considerably out-performed the remortgage market that has fallen 63% in one year. This can largely be attributed to the housing market decline.

What are the most popular equity release products?

Well, according to SHIP 52% of those who took out equity release chose drawn downs, while lump sum plans made up 46% of the market. Finally, a small proportion of individuals opted for home reversions.