Provider withdrawals worsen equity release results

Published on

The value of the equity release market has fallen by 13% from £244.7 million in Q1 2009 to £213.4 million in Q1 2010,according to SHIP, the equity release provider trade body.

The total number of customers year-on-year has fallen by 7%. The percentage of sales through intermediaries has remained stable at the 79% mark.

Home reversion advances rose by 10% on Q4 2009 to £4.4 million, while drawdown mortgages remained the most popular form of equity release, claiming over half of the market share (55%) with £116.4 million worth of advances. Lumpsum mortgage sales were £92.6 million in the quarter. The distribution of equity release continued to be dominated by intermediaries, who accounted for 79% of all sales.

Total market advances fell by 8% in the first quarter of 2010 compared with Q4 2009 (£213.4 million in Q1 2010, £231.7 million in Q4 2009). SHIP says this was to be expected as a number of providers have withdrawn products from the market, either temporarily or permanently.

The total number of customers also fell, by 3.5% quarter on quarter from 4888 to 4716.

Andrea Rozario, director general of SHIP, said: “These figures show that despite the withdrawal of some big providers from the market the equity release market remains robust. The bad weather at the beginning of the year has also obviously had some impact on the first quarter results with conditions making business difficult but reports from members now show a very strong run rate.

Latest POLL

COMMENT ON MORTGAGE SOUP

We want to hear from you!
Leave a comment and get the conversation started.
You need to register to post, so please login or sign up below.

Latest articles

Bank of England expected to hold interest rates at 4.5% amid economic uncertainty

The Bank of England is widely expected to maintain interest rates at 4.5% when...

£6.5k bill for homebuyers who miss stamp duty deadline

Rent and mortgage spending rose 7.7% year-on-year in February, as more homeowners moved from...

Advice Guru partners with Pure Retirement to support broker education

Financial adviser learning platform Advice Guru has announced a new sponsorship partnership with Pure...

Nationwide ups LTV limits for interest-only and foreign national borrowers

Nationwide has announced changes to its mortgage lending criteria, increasing the maximum loan-to-value (LTV)...

Other news

Why predicting 2025 interest rates feels like a fool’s errand

In my first (and for some reason clearly not my last) article last month,...

Bank of England expected to hold interest rates at 4.5% amid economic uncertainty

The Bank of England is widely expected to maintain interest rates at 4.5% when...

£6.5k bill for homebuyers who miss stamp duty deadline

Rent and mortgage spending rose 7.7% year-on-year in February, as more homeowners moved from...