Equity release advisers are confident about the growth prospects for the sector this year, according to Bridgewater Equity Release.

The home reversion specialist’s poll of more than 300 intermediaries found that 77% of those surveyed expect the sector to flourish in the next 12 months, while 22% thought it would remain stable.

Only 1% of respondents expected the equity release market to contract in 2012.

Despite this positive outlook, advisers have conceded that the market still faces a number of challenges in the year ahead. The main obstacle is public perception, with 77% of respondents admitting that consumers continue to view equity release with suspicion.

Other barriers to progress mentioned included insufficient funding limiting product choice, a lack of government support and fears over existing providers withdrawing from the sector.

Peter Welch, head of sales and distribution at Bridgewater Equity Release, said: “Despite the best interests of those operating in the sector