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Rise in equity release cases but value of lending remains flat

Safe Home Income Plans has revealed a small drop in the total value of new equity-release business written in the second quarter of 2006.

Total business stood at 262.8m, a drop of 5.8 per cent on Q1 but 0.75 per cent higher than Q2 2005.

Many commentators believe the industry has not grown as quickly as hoped because of a shortage of advisers.

However, Ship says the number of new cases has risen by 12 per cent year on year to 6,417 from 5,745 in Q2 2005.

It says this is due to the growing popularity of drawdown mortgages. Home reversions accounted for 13.6m of new business, up by 28.3 per cent on Q2 2005.

Chief executive Jon King says: “Overall business value figures are flat but the number of cases is still climbing as more and more people consider using equity in their homes to fund retirement lifestyles. Drawdown mortgages are proving particularly popular and are a welcome development.”

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