Public equity release optimism doubles

Equity Release Solicitor’s Alliance (ERSA) has found the percentage of people considering using their home as a retirement asset, rose from 20% to 38% over the past 12 months.

The group's survey of 4521 UK adults also reveals the overall percentage of people with a positive or neutral perception of the product rose by 6% to almost two-thirds (63%.)

Encouragingly, there was a significant drop in those saying they will not use it, down to 27% from 43%.

Chairman of the ERSA, Claire Barker said: "Both awareness and demand have grown significantly" in the past year as public sector cuts, inflation and financial obligations have encouraged retirees to seek alternative sources of capital.

When asked how they learnt about the product, a third of participants said word of mouth recommendations, which rose from 25% to 33. Other sources were adverts (33%) and reading articles (32%).

However, just 8% of people said they gained awareness through a financial adviser, which, although an increase from 6% since last year, shows a clear gap in IFA business.

In response, Barker hoped 2012 would see: "more IFAs advising on equity release. The demand for equity release is rising and there needs to be more advisers who are authoritative on this and prepared to discuss it with clients. While it is extremely positive that media coverage and word of mouth recommendations play such a large part in awareness of equity release, this is a major financial decision and people need advice from professional IFAs and specialist solicitors.

"More advisers, increasing awareness, and greater take-up of products would also have the knock-on effect of demonstrating the increased demand for equity release and would encourage more providers to enter the market with innovative products that meet the needs of a wide range of consumers."