It has already reached a record of almost £1.4bn for the first six months of 2017, up from £900m in the same period last year.

According to the Equity Release Council (ERC), the substantial market growth has also witnessed a surge in products, with a near tripling of options over the last three years.

In 2014 just 27 product options were available, little changed from the 24 available in 2007, however there are now 78 products available from council members – 20 alone added this year so far.

Customer growth

The ERC’s autumn report also noted that 31,158 homeowners over the age of 55 unlocked housing wealth in the first half of 2017. Of these, 54% were customers taking out new plans, with new customer numbers rising 42% year-on-year to almost 17,000.

And new customers accounted for around £1.22bn of lending activity, up 58% year-on-year.

While the average age of new equity release customers is largely unchanged (71.5 years old for drawdown and 68 for lump sums), it appears older homeowners are increasingly interested in unlocking wealth from their properties.

The first six months of 2017 saw 25.1% of new drawdown plans taken out by 75-84-year-olds (up from 23.2% in H1 2016) with 13.6% of new lump sum plans chosen by those aged 75-84-years-old (up from 12.3%).

Important role

Equity Release Council chairman Nigel Waterson noted it was clear that unlocking housing wealth had an increasingly important role to play in helping older people pay for later life.

“The second half of 2017 will bring the publication of the Financial Conduct Authority’s Ageing Population Project, continued work to implement the Financial Advice Market Review and further examination of the retirement income market,” he said.

“Our sector has an important role to play in each of these initiatives, and we will continue to work with government – particularly on plans for a new single public body for financial guidance.”

Waterson also praised the growth of products and innovation over the last four years, adding: “Such growth also comes at a time when the challenge of ensuring adequate financial provision for consumers in later life has never been greater.

“The UK’s older population continues to grow and the reality of a shift from final salary to defined contribution pensions will likely result in future retirees facing a greater savings shortfall in later life,” he added.