Jayne Almond, chief executive officer of Stonehaven, claimed that although the market was not growing as fast as it should be, there was a real customer need for products. Almond claimed that the market had grown in 2007, yet it should grow by 10 times from the current value of £1.4 billion.
At a recent market forecast, Almond said that there had not been a great deal of progress in equity release, with no real product innovation, and with distribution not developing as rapidly as the company would have liked. In terms of products, the company claimed that there had been some innovation. Almond said that she would like to see loan-to-values pushed as high as they can go.
Almond claimed that there was a need to get ‘a hugely positive message out there’ in 2008, and that equity release should be considered by brokers who are looking for alternative sources of revenue.
However, the forecast for next year was not completely positive, as Almond claimed: “Some providers will have funding problems. Anyone relying on securitisation will have difficulties and it will have an effect on many people. Without bank backing with a large balance sheet there will be problems.”
The firm also hoped that high street banks would enter the sector, but conceded that the larger lenders would have higher market priorities.
Andrea Rozario, director-general of Safe Home Income Plans, said: “The biggest problem is distribution. We need one bank to start and the rest will follow. If there’s a client need, what alternatives have they got?”
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