Top Reasons Homeowners Use Equity Release to Access £4 Trillion Housing Wealth
•January 30, 2026
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Why It Matters
The trend reshapes retirement financing and inter‑generational wealth transfer, putting pressure on inheritance‑tax policy and financial‑advice markets.
Key Takeaways
- •Over‑55s hold £3.7 trillion property wealth.
- •Equity release usage for gifting rose to 19 % in 2025.
- •Home adaptations now top reason, at 43 % of applicants.
- •Market grew 11 % to £2.57 bn lending in 2025.
- •Lifetime mortgages dominate, over 99 % of releases.
Pulse Analysis
The United Kingdom’s over‑55 cohort now controls roughly £3.7 trillion of housing wealth, representing 68 % of the nation’s total property value. This concentration of equity has turned homeownership into a de‑facto pension asset, prompting retirees to tap into their homes without relocating. Equity‑release products, especially lifetime mortgages, allow borrowers to convert illiquid property value into cash while preserving residence rights. As life expectancy rises and traditional pension schemes face pressure, homeowners increasingly view their homes as a flexible financial reservoir that can fund retirement needs and inter‑generational wealth transfer.
Recent Canada Life data reveal a clear shift in why seniors draw on equity. Gifting to children or grandchildren surged to 19 % of all releases, the highest in a decade, reflecting heightened estate‑planning concerns amid frozen inheritance‑tax thresholds. Simultaneously, home‑adaptation projects became the leading motive, cited by 43 % of applicants, while emergency‑savings funds grew from 8 % to 21 % within a year. These trends suggest retirees are balancing immediate lifestyle upgrades with a defensive cash buffer, using equity release as a tax‑efficient bridge between personal liquidity and legacy objectives.
The equity‑release market expanded 11 % in 2025, pushing total lending to £2.57 billion, and lifetime mortgages now account for more than 99 % of all releases. Regulators require a qualified adviser to disclose risks such as interest compounding and early‑repayment penalties, underscoring the product’s complexity. As the sector matures, advisers will play a pivotal role in matching borrowers with suitable plans, especially as demographic pressures intensify and inheritance‑tax policy remains static. Continued growth is likely, but sustainable expansion will depend on transparent advice and prudent product design.
Top reasons homeowners use equity release to access £4 trillion housing wealth
More homeowners than ever are using equity release to pass some of the almost £4 trillion over‑55s hold in property wealth onto the next generation, according to new research.
Equity release allows older people to access the wealth in their homes, in the form of a loan against their property’s value, without needing to sell or move.
Last year almost a fifth (19 %) of those using equity release did so to gift money to family members. This is up 3 % on the previous year, and the highest figure recorded in a decade of Canada Life’s customer data.
Sadna Zaman, home finance proposition manager at Canada Life, said:
“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.”
How much UK property wealth do over‑55s have?
Property owners in the UK aged 55 and over held a total of £3.7 trillion in property wealth in the period April 2020 to March 2022, according to Office for National Statistics data.
This represents 68 % of the nation’s total housing wealth – defined as the value of all properties minus mortgage debt.
Equity release is only available to certain homeowners typically aged 55 and over.
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The 55‑to‑64 age group owns the greatest amount of private property wealth with a total value of £1.4 trillion, a quarter of the nation’s private housing wealth.
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The cohort aged 65‑to‑74 holds £1.2 trillion (23 %).
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Those aged over 75 hold £1.1 trillion (20 %).
Stephen Lowe, group communications director at retirement firm Just Group, said:
“The sheer scale of property wealth held by older people enables them to plug into the powerhouse of financial resources held in their homes to meet a range of needs in later life – from topping up their own income in retirement to helping family.”
He added:
“The continued freeze on inheritance tax thresholds is likely to tip more estates into paying the tax but using property wealth to make living inheritances could provide homeowners with a means of mitigating the impact of inheritance tax and provide loved ones with extra financial support.”
Home adaptations or improvements emerged as the leading reason for using equity release in 2025, with 43 % of applicants citing this when applying – a substantial 10 % uplift on the previous year, according to the Canada Life data.
Whilst clearing an existing mortgage remained a key motivation, 2025 marked the first year where it was no longer the leading reason for taking out equity release, dropping from 36 % in 2024 to 27 % in 2025.
The data also highlighted a marked increase in the number of people using equity release to establish an emergency savings fund – from 8 % in 2024 to 21 % in 2025.
The rise points to heightened financial caution, with more customers prioritising a safety net against unexpected expenses, possibly in response to economic uncertainty or personal health concerns.
Zaman from Canada Life said:
“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.”
How popular is equity release?
Equity release is increasingly popular. The equity release market grew 11 % in 2025, according to the latest data from the Equity Release Council.
Total annual lending increased from £2.3 billion in 2024 to £2.57 billion in 2025. The Council’s market data is compiled from actual whole‑of‑market returns, making it the UK’s definitive equity release data.
Lifetime mortgages make up more than 99 % of the market. These mortgages let people borrow against their homes without making repayments unless they choose to. The loan and interest are paid when the customer dies or goes into long‑term care.
However, while equity release is becoming more popular, it is not without its downsides. Before arranging an application, a regulated equity release adviser must explain all the risks of equity release.
These include the fact that the cost of borrowing will eat into the remaining equity in the home if the borrower chooses not to make any repayments on the equity release loan. Expensive early repayment charges can also apply if the loan is paid off earlier than the contract terms allow, which can be up to 15 years.
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