Equity release is growing in importance as a financial tool for the over 55s planning for retirement, according to independent advisers.
Nearly every financial firm (98%) predicts releasing equity from property is ‘crucial’ for many looking for comfortable later years, reports financial firm LV=, who conducted the survey.
Independent financial advisers feel home equity release is an untapped market and destined to grow.
Most believe lack of pension provision (48%) will lead to retirement savers looking at the releasing cash from their homes.
Others cite other reasons, like repaying credit cards and debts (30%) or financing expensive home improvements or long term care (9%).
IFAs also expect more equity release providers to bring products to the market in the coming months and blame lack of choice as one of the barriers to pensioners considering the move.
Advisers also believe safeguarding customers is important with nine out of 10 believing regulated specialists should arrange equity release schemes and almost three quarters (71%) spoke against relaxing regulation on the grounds of risks to buyers.
Vanessa Owen, LV= head of equity release said: “It’s encouraging to see the majority of IFAs believe that equity release has a strong role to play in helping to solve problems such as the funding of long-term care and a lack of pensions provision in retirement.
“For many people, their home is their greatest asset so it is understandable that more and more people will want, or need, to access the equity in their home.”
Another recent report, by investment firm Barings Asset Management, disclosed that around one in 8 retirement savers were relying on a property pension to finance their old age as they had no other savings.
These property owners are mainly planning on equity release to provide the funds for their retirement lifestyle.