Robust Start to 2010 for the Equity Release Market
The equity release market has made a solid start to 2010 according to Safe Home Income Plans (SHIP) after they released figures pertaining to the first quarter of the year.
The data, which was taken from all the members of the equity release market, suggests that consolidation is being achieved despite the loss of some major players over the past 12 months.
Consolidation in the Equity Release Market
Total market advances were down 8% when compared against Q4 in 2009. A total of £213.4million was advanced in the first three months of 2010 compared against the £231.7million advanced in Q4 of 2009.
However, the adverse weather conditions that blighted much of the UK in early 2010, as well as the loss of further players in the market, considerably contributed to this. This slight drop in value was also reflected in a 3.5% drop in equity release customers during the same three month period. Quarter on quarter, customers were down from 4888 to 4716.
Drawdown mortgages remained the most popular equity release product, accounting for 55% of the market, although home reversion plans were up 10%.
Year on year shows that, as expected, the equity release market suffered from the global recession like any other sector. The value of the equity release market in the first three months of 2010 was £213.4million compared to a value of £244.7million in the first three months of 2009.
“The Equity Release Market Remains Robust”
Speaking after the release of the information, 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.
“SHIP is confident that over the course of the year the market will remain strong and it is even possible that new entrants will appear from the middle of the year onwards.”
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