Respondents named the market as the most ripe for opportunity, ahead of second charge advice, commercial property and complex buy to let. Just 18% said they had no plans to widen their firm’s advice offering.
Intermediaries have been keeping a close eye on the lending into retirement market, as a number of mainstream lenders have moved to increase maximum age limits on mortgage deals in recent weeks. Just today, Nationwide announced the extension of the age limit at the end of mortgage term from 75 to 85.
Adrian Anderson, director of Anderson Harris, which has recently branched into equity release, said brokers were keen on the sector as there is likely to be significant growth in the market in the coming years.
He said: “With interest rates at rock-bottom for several years, combined with people living for longer, pension annuity rates have subsequently been significantly lower. Equity release is therefore more in demand and unlocking equity in a property may be necessary for some.
“The principle of an equity release loan is quite simple so mortgage advisers may not find it that challenging to get up to speed.”
Anderson added that with rates becoming more competitive and new entrants joining to market, equity release is an increasingly attractive option for consumers.
But Martin Stewart, director at London Money, said the equity release market was ‘an unknown quantity’ and it was a risk that too many firms were rushing in without due consideration.
“Two or three years down the line it’s likely to be a completely different scenario for equity release, and the sector will be very similar to how the second charge market is now with more competitive products, more lenders and better education,” he added.
On second charge advice, which London Money has recently started offering on a direct-to-lender basis, Stewart said that previously negative connotations associated with second charge lending had been washed away by the FCA’s regulation of the sector.
“You can say what you like about the FCA but the fact is they’re a very good police force for our industry, so having their involvement has raised the standard for everyone involved. The alignment of second charge mortgages with first charges has to be good news for consumers, brokers and providers.”
