Equity release sector slumped last year
March 9, 2009
According to recent reports the Northern Rock crash from last year resulted in the equity release sector in the UK taking a huge knock last year, with the take up of equity release slumping.
Data that was put together by Key Retirement Solutions and suggested that the equity release sector had slumped by around 14 percent last year in the wake of the Northern Rock crisis.
In 2007 the equity release market was worth £1.39 billion according to the report, but in 2008 the equity release market dropped to just £1.18 billion. However, whilst the market in general in the equity release sector did slump officials from Key Retirement Solutions stated that it actually increased lending by 4 percent, which resulted in it taking a share of around 25 percent of all equity release distribution in the UK.
An official from Key Retirement Solutions said that last year had been a very tough one for all financial sectors, including equity release. However, he added that early signs showed that this year so far had been better than the same period last year, giving increased hope of improvement over the course of the year.
An official from the firm said: “The first quarter of 2008’s enquiries took a huge hit after the Northern Rock crash: calls were down 50 per cent and business all but dried up. But the market picked up, and drawdown products in particular grew significantly.”
He added: “Demand has never dropped, but consumer confidence was badly hit. They do not trust lenders right now, and business is swinging away from straight-to-consumer channels. But we certainly expect some providers to disappear, maybe by the end of this quarter. Competition is so fierce in this sector that there is not much difference from being a top three provider and not lending at all. We also predict the FSA coming down harder on the ‘dabbler’ brokers coming to equity release after being unable to make money from residential mortgages.”
- Two thirds of equity release advisors not up to scratch It has been claimed that around two thirds of equity release financial advisors are not up to scratch, and are letting down the many pensioners that are turning to them for advice in the current
- Many older homeowners using equity to help kids Over the past couple of years many people have found it difficult to get finance of any sorts, from personal loans and credit cards to mortgages, and it appears that the situation is taking its
- Mortgage market could slump massively by end of year As most people will be only too well aware the mortgage market in the UK and in other parts of the world has slumped over recent months, and for over a year, since the onset
- It could be a couple of years before mortgage freeze thaws out The mortgage industry has been going through turmoil for close to a year now, with the global credit crunch resulting in radical changes being made to the mortgage market. The number of mortgages available have
- What’s caused the slump in property sales? There is little doubt that the number of properties being sold in the UK has slumped, and many homeowners are now finding it increasingly difficult to sell their homes, with estate agents reporting the poorest
Comments
Got something to say?