The Equity Release Council has revealed that the number of new and returning equity release customers reached a new quarterly high of 23,395 between January and March this year.

A total of 150,653 new and existing customers have been active during the pandemic, starting from Q2 2020, compared with 171,586 in the previous two years.

Annual growth in the number of new plans agreed recovered to 21% in Q1 from -9% a year earlier.

Meanwhile, total quarterly lending reached £1.53bn between January and March, up from £1.34bn in Q4 2021.

In addition, the average new loan size grew 6% year-on-year, matching the latest inflation figure and surpassed by the 11% annual UK house price rise which added £27,000 to the average home.

David Burrowes, chair of the Equity Release Council, said: “The popularity of equity release so far this year is the natural result of modern products offering greater flexibility and a property market where growth has far outstripped inflation, alongside an ageing population.

“After two years where customer numbers have been subdued by the pandemic, realising gains from rising house prices can make a major difference to people’s quality of life.

“Not only are more people considering equity release, but they are doing so for many different reasons and helping old and young alike to fund everyday costs and major life events.

“Innovation has made equity release products more adaptable to customers’ changing circumstances. Our standards mean lifetime mortgages remain the most secure type of retirement home finance, with customers protected from interest rate rises, repossession and passing on debt due to negative equity.

“However, it remains vital that decisions are carefully considered through both a long-term and short-term lens, with family input wherever possible and with financial and legal advice in every instance.”

Stuart Wilson, corporate marketing director at more2life, added: “As today’s record figures show, the year has started with a bang for the equity release market. More than 12,000 new plans were agreed in Q1 which is a 20% increase on the same period last year, and the number of existing customers returning to withdraw from agreed reserves rose nearly 70% year-on year, approaching 2019 levels.

“With drawdown products currently making up almost three quarters of the plans sold annually, it is good to see these flexibilities in action and shows a robust path forward for the sector. This success is testament to the collaboration and hard work of lenders, advisers, trade bodies and third-party specialists in the lifetime mortgage market.

“Looking to Q2, it’s likely that with inflationary pressures adding to existing demographic drivers, more over-55s will seek to augment their income and support loved ones by tapping into their equity while house prices remain high. This makes it even more vital for equity release lenders to work closely with advisers – and vice versa – so the later life finance market can build off its current momentum to meet the rising demand and continue to provide the best possible support for over-55s exploring their financial options.”