More retirees are using equity release to support family members and fund improvements that allow them to remain in their own homes.
Intergenerational gifting has reached its highest recorded level among equity release customers, according to new analysis from Canada Life UK.
Canada Life routinely surveys prospective home finance customers to understand their reasons for taking out equity release. Its full-year 2025 data shows a clear shift in customer priorities, with gifting to family members rising to a record level.
In 2025, 19% of customers used equity release to gift money to relatives, up from 16% the previous year and the highest figure seen in a decade of Canada Life data.
The trend reflects a growing desire among older homeowners to support children and grandchildren with major financial milestones, including house deposits and education costs.
Home improvements and adaptations were the most common reason for releasing equity in 2025, cited by 43% of applicants. This represents a 10% increase on the previous year and underlines the extent to which retirees are prioritising staying put and investing in their existing homes.
MORTGAGE REPAYMENT
Clearing an existing mortgage, while still significant, fell from being the leading motivation for the first time. In 2024, 36% of customers released equity to repay a mortgage, compared with 27% in 2025.
The data also points to a sharp rise in the number of customers using equity release to create an emergency fund. This increased from 8% in 2024 to 21% in 2025, suggesting a more cautious approach to later-life finances, potentially driven by wider economic uncertainty or concerns around health and care costs.
Sadna Zaman, home finance proposition manager at Canada Life, said: “It’s clear from Canada Life’s data that equity release is increasingly supporting customers with a broader range of retirement ambitions and family needs.
“No longer regarded as a last resort, equity release is supporting customers to enhance their lifestyle and homes, build financial resilience, and support estate planning.
“The majority of customers citing home improvements as their primary reason for releasing equity highlights a growing desire to remain in and invest in their own homes.
“At the same time, more customers are incorporating equity release into their estate planning strategies, using property wealth to pass assets to the next generation in a timely and tax-efficient way.
“This is enabling families to support loved ones with major milestones, such as home purchases or education, while also potentially reducing inheritance tax liabilities.
“The range of uses for equity release underscores the importance of tailored, expert advice.
“Equity release may not be the solution for everyone, but advisers play a vital role in helping customers make informed, confident decisions about their financial futures in later life.”
