IPPR. Lifetime Mortgages Extending Equity Release Downwards 9th January 2006 Keith Haggart. AGENDA. The potential market for lifetime mortgages Lifetime mortgages - market constraints Access to advice Transactional costs Minimum's Property and longevity risks Funding
Extending Equity Release Downwards
9th January 2006
LIFETIME MORTGAGESTHE EQUITY RELEASE MARKET HAS SEEN CONSIDERABLE GROWTH IN RECENT YEARS, INCREASING FROM £665M IN 2002 TO £1,210M IN 2004.
Lifetime Mortgage market expected to grow to £6.9 billion by 2008 , according to Datamonitor and Prudential.
LIFETIME MORTGAGESTHIS GROWTH IN THE LIFETIME MORTGAGE MARKET IS LIKELY TO CONTINUE IN THE YEARS AHEAD
According to research conducted by Prudential in conjunction with Datamonitor, the Lifetime Mortgage market could grow from the £1bn advance per annum today to £6.9bn in 2008. This growth is going to be driven by a number of factors;
LIFETIME MORTGAGESUNITED KINGDOM GOVERNMENT’S CONCLUSION ON DEMOGRAPHIC CHANGE
The Pensions Commission concludes that the continuing demographic changes causing the shortfall in pensions and savings could be mitigated by the following options:
Which is fine if you’re still young.
However, for people aged 50+ today, these options have come too late.
Equity Release is the only viable solution to realising retirement dreams.
The high initial fixed costs of a lifetime mortgage purchase, places upward pressures on the minimum initial premium
Sales completed Jan/March 2005 - Source, Land Registry
Consumer market issues
access to advice
associated costs of taking out the product
exclusion by virtue of property type and value
Provider market issues
structure and costs associated with funding the product