More than 60% of consumers would never use equity release, according to research by Retirement Plus.
The survey of 1000 people shows just 35% would consider the products.
Duncan Young, managing director of Retirement Plus, says many consumers do not need equity release.
He says: “Everyone makes lots of assumptions about how people will act but people actually are much more logical and rational than the pundits say. People are working longer, rearranging their finances in different ways so they don’t actually need to do equity release.
“Equity release comes down to a real desire to use money for a particular purpose like a holiday or helping kids, or it’s almost a last resort.”
The research shows just 6% would release cash from their home as soon as next year.
Young says: “I think it is because over the last year people's living standards haven’t been going up because of tax burdens and this is beginning to bite. There is more discussion about equity release but I think it is discussion rather than doing the trade."
Most consumers, at 26.6%, would go to a bank for equity release advice, even though only HSBC offers an equity release referral service. Almost 26% would go to an IFA while 15.4% would ask family and friends for advice.
More than 50% would like to receive equity release advice in a face to face meeting at home while 32.3% would like face to face advice at an office. Almost 9% would like advice over the phone while just 6.4% would prefer website advice.
Young says: “People shouldn’t go to a direct sales force with one product because people’s needs vary and I don’t know of one product that can meet everyone’s needs. There are nuances in the product and no one product has them all.
“As the education and information flows increase, people’s confidence in equity release will rise and therefore the market will move up quite significantly.”
Almost 58% have heard of equity release while 41.5% have heard of lifetime mortgages and 34% have heard of home reversion. Almost 30% have heard of safe home income plans (SHIP).
Almost 27% would use equity release to help family while 14.8% would use it to improve day to day life and 12.6% would use it to pay debts.
Most consumers, at 58%, would like to receive the value from their home in a lump sum while 22% would prefer it as a regular income and 20% would like to draw it down when needed.
The survey also shows 74% of retired consumers believe they have an enough retirement income while 54% of consumers yet to retire believe they have enough retirement savings.
Earlier this month a survey by Fool.co.uk found seven million people will use equity release to supplement their retirement income.
Last month data from the UK Equity Release Market Monitor showed equity release sales rose a third in the first half of 2007.
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