Equity release: Quarterly trend summary (Q2 2025)

Summary: Key equity release trends for Q2 2025

• Total lending: £636 million
• Year on year change: +10% (vs £578 million in Q2 2024)
• New plans completed: 5,319
• Average new lump sum: £126,422
• Total customers (new and returning): 14,404

Annual growth but slight slowdown from Q1

In Q2 2025, older homeowners unlocked £636 million of housing wealth through equity release, using 14,404 new and returning plans across the market. This was 10 percent higher than in Q2 2024, but around 4 percent lower than the lending recorded in Q1 2025, reflecting a small step down in activity after a strong start to the year. Overall, the data shows a sector that continues to grow steadily on an annual basis, despite short term headwinds and wider mortgage market challenges.

Key figures: How the equity release market performed

• Total lending: £636 million
• Year on year change in lending: +10% (up from £578 million in Q2 2024)
• Quarter on quarter change in lending: −4% (from £665 million in Q1 2025)
• Total plans (new and returning): 14,404
• New plans completed: 5,319
• Returning drawdown customers: 7,640
• Further advance customers: 1,445
• Typical new lump sum release: £126,422
• Typical new initial drawdown release: £65,856

Loan sizes rose year on year but eased since Q1

The Equity Release Council data shows that while total plan numbers were broadly unchanged quarter on quarter, both total lending and average loan sizes were higher than a year earlier. New lump sum customers borrowed on average £126,422, 14 percent more than in Q2 2024, while new initial drawdown amounts were slightly higher year on year at £65,856. At the same time, many averages fell modestly compared with Q1 2025, which suggests borrowers and advisers have been cautious in the face of short term house price and interest rate uncertainty.

Why homeowners used equity release in Q2 2025

• Managing or repaying existing debt, including mortgages
• Boosting retirement income or day to day finances
• Providing financial support to family members
• Accessing additional funds through further advances on existing plans

Borrowers used housing wealth to manage debt and support family

According to the Equity Release Council, growth in Q2 2025 continued to be driven by new borrowers accessing greater amounts of housing equity to manage debt, boost income and support their wider families. Further advances increased by 40 percent year on year, although they still accounted for less than 7 percent of total lending. This pattern indicates that some existing customers are returning to draw more from their plans, often in response to rising living costs or new financial needs, while many new customers use equity release as part of wider planning to make later life finances more manageable.

Market activity: Demand growth and product flexibility

• Fourth consecutive quarter of lending growth
• Increased demand driven by new customers taking lump sum plans
• More lenders expanded flexible repayment features

Product choice expanded while customers borrowed cautiously

Customer numbers remained stable compared with Q1 2025, with a small increase in both total plans and new plans versus the same quarter in 2024. Drawdown products remained slightly more popular than lump sums, with 55 percent of new customers choosing a drawdown facility that allows them to release an initial amount and keep a reserve for future use. The average rate on new products launched in Q2 2025 was 7.24 percent APR, higher than the 6.64 percent seen in Q2 2024, reflecting higher gilt yields and funding costs. At the same time, the number of products on the market grew to about 1,669, and around half offered dynamic pricing, meaning the final rate depends on features such as age, loan to value and property value. This combination of higher rates, broader choice and smaller up front drawdowns suggests that both lenders and customers are focused on flexibility and careful borrowing.

What this means for homeowners exploring equity release

• Equity release continues to see steady year on year growth
• New lump sum borrowers are taking larger average loans than a year ago
• Drawdown and flexible features can help customers manage borrowing over time

A growing but advice led market for later life borrowing

For homeowners who are considering equity release, the Q2 2025 figures show a market that is still growing on an annual basis and offering a wider range of product options. Larger average lump sums indicate that some borrowers are using equity release to address significant financial needs, such as repaying mortgages or other commitments, while the popularity of drawdown facilities points to a more measured approach where funds are accessed gradually. Against a backdrop of higher interest rates and evolving house price trends, it is especially important for consumers to seek regulated advice so they can weigh the long term costs, protections and alternatives before deciding whether equity release is suitable for their circumstances.

About this report

This quarterly trend summary is produced to help consumers understand how the equity release market is changing over time. It is based solely on publicly available data from authoritative sources including the Equity Release Council, the Office for National Statistics and publicly reported industry analysis. The report is published shortly after each quarterly data release and is designed to present market movements in a clear, simple and accessible format for homeowners considering their options.