The equity release market recorded its strongest annual growth in recent years, with total lending reaching £2.57 billion in 2025.
The equity release market grew 11% in 2025, according to the latest research from the Equity Release Council.
Total annual lending increased from £2.3 billion in 2024 to £2.57 billion last year, based on whole-of-market returns compiled by the Council.
The data, which represents the UK’s definitive equity release figures, shows continued demand for later life lending as homeowners look to access property wealth without selling or moving home.
Lifetime mortgages continue to dominate the sector, accounting for more than 99% of the market.
BEHAVIOURAL CHANGES
Survey data accompanying the market figures suggests changing borrower behaviour. More than a quarter of advisers responding to the Council’s latest poll, 26%, said customers are now using equity release to clear existing mortgage balances.
Meanwhile, 40% reported that borrowing is being used for discretionary or lifestyle purposes, including home improvements at 21%, holidays at 6%, car purchases at 4%, or gifting to family members at 13%.
Jim Boyd, chief executive of the Equity Release Council, said: “Growth of 11% underlines the increasingly important role housing wealth is playing in supporting financial resilience and choice in later life.
“It reflects something far bigger than short-term market movements – equity release is proving vital to meeting people’s social and economic needs.
“Modern products are more flexible and secure than ever and, for many homeowners, accessing housing wealth is now a core part of their retirement planning, helping them enjoy financial freedom and a better quality of life.
“Releasing property wealth now supports around £1 in every £90 spent by retired households.”
Q4 2025 PERFORMANCE
The Council’s latest quarterly figures show that momentum continued into the final quarter of the year. Total lending in Q4 2025 reached £632 million, a 1.6% increase compared with £622 million in Q4 2024.
The average amount released rose to £123,174 during the quarter, representing a 5.7% increase year-on-year. Demand for further advances also remained strong, with 1,468 customers returning to access additional borrowing, up from 1,411 in the same period a year earlier.
LOOKING FORWARD: 2026 AND BEYOND
Adviser sentiment points to continued growth. Four in every five advisers surveyed by the Council, 80%, expect total lending to increase further in 2026 compared with 2025, while only 2% forecast a decline. A similar proportion anticipate an increase in overall customer numbers.
David Burrowes, chair of the Equity Release Council, said: “Increasingly, releasing equity is part of homeowners’ retirement plans. Almost four in every 10 future retirees, 38%, are on track for a retirement income below the Pensions UK ‘minimum standard’. Demographic and economic pressures mean the demand is there and likely to grow.
“Innovations in product design are making modern equity release more flexible and more secure, making it more attractive to consumers. The Council also sees sustained long-term growth being supported by increased collaboration across the later life lending sector and regulatory engagement.
“In Q1 of 2026, the Financial Conduct Authority launches a focused later life lending market study, examining how mortgages and property-based solutions can better support consumers borrowing into retirement.
“This is an important step which reflects the reality that borrowing in later life is becoming more common and that the market must continue to evolve to deliver good consumer outcomes.
“That regulatory focus, combined with collaboration and continued product innovation, gives us confidence in the sector’s long-term direction. We have never had a better opportunity to bridge the retirement later life funding gap.”
MORE MAINSTREAM
Lorna Shah, managing director, retail retirement, L&G, added: “These figures suggest that equity release has become an increasingly mainstream consideration as people seek to draw on the funds tied up in their homes to achieve their retirement goals and individual lifestyles.
“L&G works closely with financial advisers and the broader industry to ensure customers are able to make informed decisions that best meet their retirement income needs.
“This ongoing and collaborative dialogue helps ensure that the later life lending sector remains innovative, responsive and customer-driven.”
GROWING DEMAND
Dave Harris, CEO of later life lender, more2life, said “An 11% annual rise in equity release lending is welcome and shows that demand for, and understanding of, lifetime mortgages is growing among both consumers and advisers. It is also encouraging that four in five advisers expect further lending growth in 2026.
“However, these figures also hide a bigger issue. Despite the rise in lending value, the number of new customers grew by less than 1% year-on-year. Lifetime mortgages still account therefore for less than 10% of a later life lending market worth around £25bn a year. Given the range of products now available, that gap feels hard to justify.
“We believe too many over-55 homeowners, who could benefit from modern lifetime mortgages, are still not seeing them as part of their advice journey.”
“We believe too many over-55 homeowners, who could benefit from modern lifetime mortgages, are still not seeing them as part of their advice journey. Products have changed.
“Many now allow interest to be fully or partly paid, offer zero early repayment charges, and continue to provide certainty of tenure, fixed rates for life and a no negative equity guarantee. These are not fringe options. They sit alongside RIOs and mainstream later life mortgages and should be considered in the same conversation.”
ACCESS ISSUE
And he added: “There is also a clear access issue. Many advisers still do not cover later life products themselves and that can limit outcomes if referral routes are not in place.
“Forming strong relationships with trusted specialists should be standard practice, not the exception, if advice is to reflect the real choices available to older borrowers.
“The FCA’s ongoing later life lending study is an important step, particularly around holistic advice. But advisers do not need to wait for regulation to change.
“The profession can act now by making sure every customer is assessed across all suitable options. Demand is clearly there. The challenge now is to ensure advice keeps pace, so more customers can access solutions that genuinely support their later life goals.”
MORE WORK NEEDED
Paul Carter, CEO of Pure Retirement, said: “The latest figures from the Equity Release Council demonstrate the extent to which lifetime mortgages continue to fulfil the needs of over-55s.
“The rising average lump sum borrowing on both an annual and quarterly basis demonstrate the confidence new customers have in releasing the equity in their homes, while the increasing levels of people taking out further advances underlines how comfortable those who’ve already taken out equity release are in returning to release additional funds.
“The quarterly increases in customer numbers are also positive, but the fact that 2025 as a whole saw a reduction on an annual basis points towards the work needed to ensure later life lending truly becomes a mainstream solution going forward, especially as Canada Life’s recent research has suggested that financial advisers are failing to mention equity release as an option in 93% of conversations with home owners about retirement.
“With lifetime mortgages clearly meeting a very real societal need among those utilising them, the latest Council figures should spur us on as a sector to ensure they’re part of widespread financial planning in 2026 and beyond.”
MORTGAGE DEBT
Mark Gregory, founder and CEO of Equity Release Group, said: “More people today are reaching later life still carrying mortgage debt, often on fixed or reduced incomes, and trying to make their money last longer. When you combine that with longer life expectancy and the slow demise of defined benefit pensions, it’s no surprise that homeowners are starting to look at their property wealth alongside pensions and savings, not instead of them.”
ACCESS TO ADVICE
He added: “However, growth alone is not the only story here. What’s evolved the most is how people want to access advice. Growth hasn’t come from pushing a single product or relying on one route to market. It’s come from giving people more choice in how they engage, the personalisation, the choice and supporting that with best-in-class advice and clear consumer duty safeguards.
“We know digital engagement works but only when it’s paired with quality advice, clear suitability, and the kind of robust assessments that protect customers and support good outcomes.”
