The headlines around the latest Equity Release Council figures released this month all suggested growth. But I think we need to have an honest conversation about what those numbers actually mean.
One of the things I value most about the equity release and later life lending sector is that we tend to support each other.
Advisers, lenders, networks, and specialists regularly share ideas, discuss difficult cases, and collaborate in a way that is genuinely unusual for a competitive industry.
That collaboration is important, because the reality is that we are all operating in a market that has been through three extremely difficult years.
Since the Liz Truss mini-budget in September 2022, we have experienced significant gilt volatility; rapidly changing product pricing; reduced product availability; high-LTV options appearing and disappearing with little notice and a level of uncertainty that has made long-term planning incredibly difficult for both advisers and customers.
Yes, the latest quarterly figures show improvement compared to Quarter 1 of this year.
But here is the question I keep coming back to: Does growth from a depressed base equal recovery?
Because when I look at the market on a half-year basis, the picture is far less comfortable.
We are still dealing with a smaller overall lending market than many expected by 2026; higher customer borrowing costs than the sector was accustomed to before 2022 and fewer product shelves and lending propositions available across parts of the market.
“This is not about being negative. It is about being realistic.”
This is not about being negative. It is about being realistic. If we convince ourselves that the market has already recovered, we risk focusing on the wrong priorities.
The truth is that many of the biggest challenges facing later life lending are outside our control such as gilt yields; swap rates; funding costs and maximum LTV appetite.
But what we can control is how we educate advisers; how we communicate product innovation; how we support customers in understanding their options and how lenders and advisers work together to improve customer outcomes.
“Resilience is not the same thing as recovery.”
In my view, the sector has shown remarkable resilience. But resilience is not the same thing as recovery.
The danger is that we celebrate short-term improvements while ignoring the structural questions that still need answering.
- Has customer demand genuinely returned, or are customers simply adapting to a new normal?
- Are current volumes sustainable if rates remain elevated for longer than expected?
- And is the industry doing enough to expand awareness of later life lending beyond the specialist community?
I’d be interested in the views of advisers, lenders, networks, and providers across the market.
Do you believe the later life lending market has genuinely recovered, or have we simply become better at operating in a smaller, more challenging market?
Tomorrow, I’ll be looking at what I believe is one of the biggest blind spots in our industry: why many residential advisers are still approaching over-55 customers using a knowledge framework that is heavily centred on mainstream residential lending.
