Key Retirement Solutions has re-launched its report on the state of the market, the UK equity release market monitor, and it shows the 14,701 plans were sold in the first six months of 2007, an 18 per cent increase over the 12,437 sold in the same period last year. The total amount released in the first half of this year has increased by a third from £496m in the first half of 2006 to £660m in the first half of 2007.
However, the average amount released in each plan is up by only 7.6 per cent.
Business development manager Dean Mirfin says this is down to the increase in the number of people taking the drawdown option for equity release, so more people are releasing smaller amounts of money as they need it.
Drawdown now accounts for 44 per cent of all equity release plans, up from just 16 per cent last year, and Mirfin says: “We attribute this to the growing number of lenders who now offer this facility, the increased awareness among advisers that more lenders are offering drawdown and increased consumer awareness.”
Mirfin says sales of home reversion plans has dropped slightly since these loans became regulated but he expects sales of all equity release products to increase in the second half of the year.
He says: “We are confident that the market will continue to grow in the second half of the year, which is usually the strongest period for equity release.”
Key’s figures also show the average age of borrowers using equity release has dropped from 71 to 70.