More than half (54%) of advisers expect a rise in enquiries about later life lending in the next 12 months driven by the launch of new products and increased confidence in the housing market.

That’s according to new research from Key Later Life Finance, an equity release adviser.

Around a third (35%) expecting a rise in enquiries say part of the reason is the development of new later life lending products for specific customers needs while 34% point to growing confidence in the housing market, Key’s study with wealth advisers, over-50s specialists and generalist advisers found.

More than a quarter (27%) say house prices rises will drive increased demand over the next 12 months with 26% interviewed pointing to further Bank of England base rate reductions. The optimism about the next 12 months builds on growth in enquiries in the past year with 59% questioned reporting an increase.

However, the research also identified high levels untapped demand providing support for the belief that the later life lending market – estimated to be worth £30 billion – is not achieving its potential.

Key believes all types of advisers should be considering all options for clients in later life including incorporating property wealth as part of retirement accumulation and de-cumulation planning strategies and exploring lifetime mortgages, as well as other specialist later life lending products, for customers over the age of 50 looking to take debt into retirement.

The research found 87% of advisers estimate they have clients who would benefit from later life lending products including 38% who estimate this would be the case for more than half their clients. On average advisers questioned estimate 45% of their clients would benefit from later life lending solutions.

Almost all (93%) questioned say they have at least one client a month asking for later life lending products including half (47%) who receive enquiries at least once a week.

However, Key claims advisers appear to be limited in what they can recommend or advise – less than two out of five (36%) said they would look at all options.

Will Hale, group director at Key, says: “Optimism about the later life lending market remains relatively high with the year ahead looking positive following a reasonable past 12 months. However, we remain a long way off the highs of 2022 and although there are signs of a recovery it continues to be a challenging period for specialist advisers and lenders.

“The real cause for optimism is that advisers are recognising that more of their clients would benefit from later life lending solutions with almost all seeing enquires at least on a monthly basis.

“The challenge is of course translating untapped demand into material market expansion so more customers can benefit from these modern later life lending products that are well-positioned to address the wants and needs of the over 50s.  

“The key barrier is advisers generally focusing on their own area of expertise and not thinking more widely. We must continue to encourage advisers to consider all options and to put trusted referral relationships in place with other specialists in order to achieve better outcomes for customers. ”