Membership of the Equity Release Council (ERC) has increased by 97% in the past two years, with the total number of firms rising from 219 to 431.
Last year saw a 35% annual increase in council membership among adviser firms from 246 to 332, while the number of solicitor firms rose by 46% from 41 to 60.
It is not surprising that membership to the ERC has increased by almost 100% considering the number of retirees opting for equity release as a means to generate a retirement income.
Andrew Gilbert, director of proposition, savings and retirement at LV= said: “Equity release is increasingly being seen as a mainstream option in retirement and rightly so. The government backed a Select Committee recommendation that the new Money and Pensions Service (MaPS) sign-posted retirees to consider home finance options including equity release as part of a broader retirement planning strategy.
“I believe that it’s our job to equip advisers with the knowledge and products they need to provide their clients with the right choices to support their retirement. Our findings highlighted that only 25% of advisers felt most informed about equity release compared to 91% for pensions and 74% for annuities,” Gilbert added.
“I believe that it’s our job to equip advisers with the knowledge and products they need to provide their clients with the right choices to support their retirement.”
Property wealth released
Retired homeowners released more than £3.4 billion of property wealth last year as 2019 ended on a high despite political and economic uncertainty making consumers cautious, data from the UK’s leading over-55s specialist adviser Key shows.
Homeowners released nearly £9.5 million of property wealth a day in 2019 but caution among consumers and the dominance of drawdown saw the average amount released slip marginally to £75,631 compared with £76,473 in 2018.
Steve Wilkie, managing director of retirement mortgage experts Responsible Life says: “The later life market is stronger when firms work together to strengthen protection for customers, and the doubling in the number of firms under the Equity Release Council banner underlines the industry’s commitment to best practice.
“Consumer protection becomes stronger and more uniform as the council grows, and it means customers can expect the same high standards across the vast majority of the market.
“This year is poised to be a landmark one for the later life mortgage industry, with further growth in customer numbers and products expected, and the council’s expansion, sitting side by side with this, will further improve customer outcomes.
“Crucially, adviser firms have also increased by 35% over the past year, and the update in the council’s standards underscores the importance the industry is placing on customers receiving the right advice. The council is also a great vehicle for the FCA to use while it aims for greater understanding of the market.
“Evolving qualifications and further policy work throughout 2020 will ensure the industry is enhancing the customer experience every step of the way.”