Equity Release Market Sees 10% Growth in Q2 2025 – What It Means for Homeowners
The latest report from the Equity Release Council shows that the equity release market remains resilient and continues to grow in 2025. In the second quarter of this year, UK homeowners accessed £636 million of property wealth, marking a 10% increase compared to Q2 2024. This growth highlights the increasing popularity of later life mortgages, lifetime mortgages, and flexible borrowing options among over-55s who want to unlock the value of their homes.
At My Later Life, we have long been at the forefront of this market. As a whole-of-market equity release broker, we search across all leading lenders to find the best equity release plans for our clients. Whether you are considering a lump sum lifetime mortgage or a flexible drawdown plan, our expert advisers ensure you make the most of your property wealth while safeguarding your future.
Key Highlights from Q2 2025 Equity Release Data
The Q2 2025 market report offers valuable insights into how the later life lending sector is evolving:
Total Lending: £636 million in equity released by homeowners, up from £578 million in Q2 2024.
Number of Customers: 14,404 customers (new and returning) accessed property wealth this quarter.
New Plans: 5,319 new equity release plans were taken out, representing a 2% increase year-on-year.
Further Advances: Existing customers took out 40% more further advances than in Q2 2024, taking advantage of product flexibilities and rising house values.
Average Loan Sizes:
New lump sum lifetime mortgage: £126,422 (+14% YoY).
New initial drawdown: £65,856 (+1% YoY).
Drawdown reserves: £53,338 (+16% YoY).
These figures indicate that equity release customers are becoming more strategic in their borrowing, opting to keep reserves for future needs rather than taking all funds upfront.
The Rise of Flexible Later Life Mortgages
One of the standout trends from the report is the growing preference for drawdown equity release plans. In Q2 2025, 55% of new customers chose a plan with a drawdown facility, which allows them to release funds gradually rather than as a single lump sum. This strategy is becoming more common as homeowners look to minimise interest roll-up by only borrowing what they need, when they need it.
While drawdown customers are releasing smaller amounts upfront (around 50–60% of their total available funds, compared to over 70% in 2021), they are also setting up larger reserve facilities. This reflects growing confidence in the long-term strength of the housing market, even as short-term conditions remain uncertain.
Equity Release Interest Rates and Product Availability
Another important update from the Q2 2025 report concerns interest rates and product variety:
Average Interest Rate (APR): New equity release products launched in Q2 2025 had an average APR of 7.24%, up from 6.64% in Q2 2024.
Product Range: There were 1,669 lifetime mortgage products available by the end of Q2, compared to just 907 at the end of Q1. This sharp increase demonstrates the commitment of lenders to offer more tailored and flexible solutions.
Dynamic Pricing: Around 50% of these products now feature dynamic pricing, where the rate depends on the customer’s age, property value, loan-to-value (LTV), and additional features.
Why Choose My Later Life for Your Equity Release Journey?
With so many products available, finding the best equity release deal can be overwhelming. At My Later Life, we make this simple:
Whole-of-Market Access: We compare the entire equity release market to secure the most competitive rates and features.
Trusted Experts: Our advisers are specialists in later life mortgages, retirement lending, and lifetime mortgages.
Personalised Advice: We take time to understand your needs, whether you’re looking to boost retirement income, renovate your home, consolidate debts, or help family members financially.
Commitment to Transparency: We ensure you fully understand all implications, with no hidden charges or surprises.
Our reputation as a market leader in UK equity release is built on years of helping homeowners make the most of their property wealth while maintaining peace of mind and financial security.
Equity Release – A Powerful Tool for Retirement Planning
Equity release, particularly through lifetime mortgages, allows homeowners over 55 to access tax-free cash from their property without needing to move or sell. The loan, along with any rolled-up interest, is typically repaid when the homeowner passes away or moves into long-term care.
With rising living costs, equity release is becoming a popular option for retirees to maintain their standard of living, support loved ones onto the property ladder, or cover expenses such as healthcare or home improvements.
Looking Ahead – The Future of Equity Release
The Equity Release Council’s Q2 2025 data shows that despite economic fluctuations, demand for later life lending is strong. Borrowers are becoming more cautious and selective, but with flexible product features and a growing range of options, the market is well-positioned to meet evolving needs.
At My Later Life, we are proud to play a key role in this growing market. Our mission is to help UK homeowners unlock the potential of their property safely and responsibly, with expert guidance at every step.
Thinking About Equity Release?
If you’re considering equity release or want to know how a lifetime mortgage could enhance your retirement, our team is here to help. As whole-of-market brokers, we can show you the best deals from all the leading providers.
Book your free consultation today and let My Later Life guide you to the right solution.
Equity release, Lifetime mortgages, Later life mortgages, Unlocking property wealth, Retirement lending solutions, Drawdown equity release, Whole-of-market equity release broker, Tax-free cash from property, Best equity release deals, Equity release interest rates UK, Property wealth in later life
