Equity Release Summit 2022, What is the Market Focusing on?

What can the Equity Release market expect and what are lenders and brokers focusing on in 2022? Thomas Brett, Head of Mortgage and Lending at Contact State discusses the key points from this year’s Equity Release Summit.  
With face-to-face events back in full flow, it was fantastic to see so many familiar faces all in one room talking about Equity Release, and where the market is going in 2022 and beyond. The talks were informative and current, with many interesting angles on current trends, and where these could lead.  
Here are my key takeaways from this year’s event, expertly hosted by the Equity Release Council

Green Mortgages

Green mortgages are a hot topic in the mortgage market as a whole, so it’s no surprise that these are moving into the later life lending space. Lenders are moving into products which will help with the purchase of greener homes, or actively releasing capital to retro-fit properties with the latest energy saving products, air and ground heating pumps, for example. L&G had a great case study on releasing capital to refurbish an old property and helping to make this home as efficient as possible. There is more work to be done in this area, with ‘eco homes’ still tricky to place with a lender currently.  

High Net Worth Clients 

High net worth clients are a big growth area for Equity Release. As the Equity Release Council and its members educate the market (customers, mortgage brokers, estate agents, solicitors etc) there has been a shift from Lifetime Mortgages being seen as a product of last resort. Many higher net worth customers are using ER as a retirement planning product with some really interesting information on this from Just Retirement, showing how it could be more tax efficient to release equity instead of releasing a pension.  

Intergenerational Wealth Gifting 
With the cost-of-living crisis, property prices still climbing, younger borrowers are finding it increasingly difficult to get onto the property ladder. A great panel discussion with Damian Green MP, John Godfrey of Legal and General and David Forsdyke from Knight Frank Finance discussed not only the benefits of early gifting to family members, but how this could benefit society as a whole. Trillions of pounds are tied up in property for the over 55s and releasing some of this can only lead to more economic stimulation. 

Customer Journeys 
One of the most informative talks came from Kay Westgarth at Standard Life with the title, ‘The Lightbulb Moment’. Their research focused on when a customer decided Equity Release was the right option for them, but more interestingly, on when a customer decided against releasing equity too. Reasons were varied with alternatives options such as downsizing a factor, but still there is the issue of the negative reputation of ER that friends and family of potential customers have.  
As we can see with the areas focused on by the summit this year, green mortgages, higher net worth, wealth gifting and customer journeys, more needs to be done to improve the full customer journey. If the market wishes to focus on these types of consumers, then the messaging seen will need to change. By enhancing the advertising used to attract, we can help more of these customers at the same time as improving the overall reputation of Equity Release from the ground up.  

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