Retired homeowners are increasingly using their property wealth to clear debts, including loans, credit cards and mortgages, according to Key Retirement.

Its equity release Market Monitor for the first three months of 2015 shows continuing strong growth with total property wealth released rising to nearly £341 million, up from £330 million last year. Total plan sales for the quarter rose to 5,110 from 4,983.

The average amount released to boost retirement income increased nearly 9% to £66,730 in the three months compared with £61,200. In London the average released was nearly £130,000.

The figures also revealed a shift in how the wealth is being used. Around 31% of customers – compared with 26% in 2014 – used some or all of the money they released to pay off unsecured borrowing, primarily credit cards or loans, while 23% used some or all of their money to clear outstanding mortgages, up from 21% in 2014.

Home and garden improvements remained the most popular way of using the money with 61% citing this as the reason, compared with 67% last year. Customers are also using the money to help others with 26% spending their property wealth on family and friends.

Key’s Market Monitor shows the average age of equity release customers rose to 71 in 2015, from 68 previously, with customers’ average property value increasing to nearly £267,929 from £212,244 previously.

Across the country six out of 12 regions saw growth in the value of property wealth released with Northern Ireland recording a 40% rise and London a 28% increase. The value released dropped 34% in the North West. Growth continued in plan sales with six regions seeing increases and three virtually unchanged. London saw a 31% rise and the North a 28% increase.

Dean Mirfin, technical director at Key Retirement, said: “Property wealth is a major part of retirement planning and the contribution it can make is substantial with customers releasing nearly £67,000 on average.

“Debt in retirement is a growing issue with large numbers of customers using money to clear mortgages as well as credit card debts and loans. That highlights a real need for lenders – including equity release providers – to develop solutions to help.”