Since 2014
The market for equity release products: Lessons from the international experience
Southern African Business Review
View Archive Info| Field | Value | |
| Title |
The market for equity release products: Lessons from the international experience
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| Creator |
Luiz, M
Stobie, G |
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| Subject |
ife cycle hypothesis, reverse mortgages, equity release products, South Africa
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| Description |
Home Equity Release Products (ERPs) are innovative fi nancialinstruments that enable elderly, retired people to use theirunencumbered houses as a source of income/funding whilethey continue to reside in them, thereby seeking to address theconstraints of the life cycle hypothesis. The loan and outstandingamounts are normally settled through the sale of the property, eitheron death or when the client voluntarily vacates. This research is anexploration of demand and supply issues that aff ect the suppliersof ERPs (both internationally and in South Africa). Interviews wereheld with established suppliers in Britain (where the market is moreadvanced), as well as with several fi nancial services companies inSouth Africa.The ERP industry has grown slowly over the last decade. Factors suchas increased life expectancy, decreased savings rates and changingattitudes towards debt are just some of the driving forces of demand.However, the growth of the ERP industry has consistently fallen shortof analysts’ predictions, highlighting some of the diffi culties facingthe market – not least of which is to gain the acceptance of both themarket and government as a mainstream option for the elderly, whoare often asset-rich but income-poor. A number of impediments tomarket growth are explored in detail in this research.
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| Publisher |
College of Economic and Management Sciences (UNISA)
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| Contributor |
—
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| Date |
2012-05-11
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| Type |
info:eu-repo/semantics/article
info:eu-repo/semantics/publishedVersion Peer-reviewed Article |
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| Format |
application/pdf
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| Identifier |
https://www.ajol.info/index.php/sabr/article/view/76367
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| Source |
Southern African Business Review; Vol 14, No 2 (2010)
1998-8125 1561-896X |
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| Language |
eng
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| Relation |
https://www.ajol.info/index.php/sabr/article/view/76367/66824
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| Rights |
Copyright on articles is retained by the author(s). The editor and reviewers of SABR cannot accept any responsibility for the infringement of authors' rights or copyright.
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