In its half-year results, the equity release group revealed market volume was down by 22 per cent to 5328 loans in Q2 2009, from Q2 2008’s 6864 cases. SHIP says Q2 numbers were up five per cent from 5074 in Q1.
But it did find that the number of drawdown mortgage sales rose by 14 per cent over the same period from 2376 to 2699.
However, although the number of sales increased over this last quarter, the value of products sold decreased from £245m to £232.9m over the same period. For drawdown mortgages, the amount released also decreased from £48,287 to £43,712 over the same period.
SHIP director general, Andrea Rozario says: “While the equity release market is still suffering along with the mainstream mortgage market, it is encouraging to see that the equity release market is starting to see evidence of some positive movement.
“The quarter on quarter increase in the number of plans shows that consumers are once more starting to believe in the UK housing market.”
Aviva group product manager for UK life, Dominic Fraser-Smith says: “These figures are encouraging and we believe they could herald the first glimmers of a recovery for the UK equity release market.”
James Trickett & Son senior investment adviser Richard Moorfield says; “I’m not surprised about the rise in drawdown mortgages, we find a lot more people are thinking of them. This is because a lot more people are turning to equity release because they know a lot more about it now. And also, a lot more IFAs are dealing with it now. It gives people flexibility. They like the idea to drawdown some money if they want to go on a cruise or something.”