Article | January 2008 | by Duncan Young
Big Question
What are the biggest challenges facing the equity release market over the coming 12 months?
I have been asked several times recently if the equity release market will see new product providers entering the field. In 2008, unless there is a radical upsurge in business levels I believe that the question will be one of: who is packing up their bags and leaving. SHIP statistics show that in 2007 total new business was £1.2bn which means that on average the 20 SHIP members advanced just £60m. That, in the world of financial services, is a tiny figure and has to call into question the viability of some operations. This viability doesn’t necessarily matter if the future is rosy - but another false dawn could mean closure.
This will have a serious knock on effect as the excellent SHIP initiative with Andrea Rozario is dependent on there being sufficient SHIP members to meet the establishment and running of a professional trade body. Members dropping out of SHIP would therefore cut the power of the trade body just at the time when a concerted positive effort is required.
So a bleak prognosis – let us hope the market expands and my concern does not materialise.