Equity release trade body SHIP has conduced research which it believes bodes well for the sector in the future.
The fifth annual SHIP members’ survey identified several factors to support this view. These factors include products fulfilling a growing consumer need (58%), the high level of regulation (21%) and increasing political awareness of the importance of equity release (5%). In addition, SHIP’s strong code of conduct was considered a strength by 32% of respondents.
The findings of this SHIP survey – which represents over 90% of the equity release market – highlights the fact that whilst providers are hopeful for the future of the sector there is still some feeling that negative perception of the industry is stopping industry participants and consumers from becoming more involved.
38% of those who answered the survey saw reputation as the biggest challenge that providers needed to overcome when speaking to consumers, funders and intermediaries. The second largest challenge – cited by 25% of respondents – was the fact that providing funding for this sector had yet to become a priority for many institutions.
The majority of providers believed that 2010 would be a challenging year with 80% believing that the market will stay at 2009 levels rather than shrink. Other predictions for 2010 included the belief that additional funding streams will open up (60%), the government will become more involved in the market (60%) and new entrants may enter the market (40%).
Andrea Rozario , director general of SHIP, said: “The equity release industry has developed considerably over the years and has strong safeguards in place to protect consumers and intermediaries. It is a concern that our members still find that a negative perception of equity release is affecting the number of consumers who can benefit from these products.