An extra 800 qualified equity release specialists must be recruited by 2020 to meet growing demand to release equity, according to research by national equity release adviser Bower Retirement Services.
If the equity release market continues expanding at its current rate of growth, the number of customers per quarter will surpass 11,000 within the next five years - compared to the 5,700 seen in the last quarter of 2014.
It is estimated that there are currently around 800 active qualified equity-release advisers in the UK, so assuming that they are already operating at maximum capacity, this means that the number of active qualified advisers will need to double in order to keep up with the demand.
Geoff Charles, Bower’s chief executive, commented that over the last year, equity release has moved into the limelight, as for many of the older generation, housing wealth is potentially their biggest asset in retirement.
“The challenge now is for the equity release sector to keep up with this expansion in demand - following a record-breaking 2014, our advisers are already operating at maximum capacity.
“But providing quality, expert advice to those considering equity release is absolutely fundamental, and the sector could be constrained by a lack of active qualified professionals if growth continues at the current rate.”
Mr Charles stated that firms need to tempt people back who may have left the industry during the recession, while promoting new advisers to pick-up the necessary qualifications. “We are currently in the middle of a recruitment campaign to service our increasing customer enquiries and we urge advisers to contact us for more information.”
In total, Bower forecasts that the number of equity release customers per year will rise to 42,100 by 2020, up from 21,300 in 2014.
The research echoes findings from the firm’s latest adviser survey, which in the fourth quarter of 2014 found that 70 per cent of advisers expected the equity release market to continue to grow over the next six months – up 10 per cent on the previous quarter.
The most recent market report from the Equity Release Council found that lending had exceeded £1bn in the first nine months of the year, predicting the year-end figure would exceed £1.2bn.
Alice Watson, marketing manager at Stonehaven, previously said that to facilitate demand, more advisers need to become qualified to give equity release advice and there needs to be a bigger commitment from the industry to support the product’s growth.
“With April 2015 pension reforms on the horizon, more advisers will need to become qualified in order to give holistic retirement planning advice. Hopefully these reforms while challenging will prove to be the catalyst for more advisers to undertake specialist qualifications.”
Andrea Rozario, chief corporate officer at Bower, told FTAdviser that advisers are the lifeblood of this industry and “we need to do everything we can to encourage new advisors whom want a dynamic and rewarding career into financial services”.
She added that more needs to be done to understand what motivates advisers and establish what support they need to feel encouraged that this is a viable career for them. “I also think the industry needs to work hard to overcome reputational issues to build confidence in not only the customers but the younger generation who are considering their various career options.”