In its full year results to 31 December, Ship said despite the drop in lending, equity release was remaining resilient compared with mainstream lending which, according to the Council of Mortgage Lenders, declined by 30 per cent during the same period.
The results showed the total value of equity release business written in 2008 reached almost £1.096bn, a 9 per cent decrease on last year's figure of £1.21bn
The number of new policies sold declined 4 per cent, from 29,293 in 2007 to 28,224 in 2008.
Sales of lifetime mortgage products dropped by 2 per cent year-on-year, from 27,764 plans sold in 2007 to 27,161 in 2008.
Meanwhile, the value of advances from lifetime mortgage products fell by 8 per cent from almost £1.128bn in 2007 to £1.038bn in 2008.
Home reversion products saw a decline in 2008, with the number of policies down 30 per cent to 1063, compared with 1529 in 2007.
The value of equity released with these products also declined 30 per cent from £82.6m in 2007 to £57.4m in 2008.
Almost two-thirds of products sold in 2008 were through intermediaries rather than through direct sales, something that remained unchanged from the previous year.
Andrea Rozario, director general of Ship, said: "A slight decline in business volumes in 2008 was to be expected given the turbulence in the economy in the last 12 months.
"Overall we are pleased with how the sector has held up, especially in comparison to mainstream mortgages."
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