According to Legal and General Home Finance’s equity release drawdown data, homeowners are drawing down their property wealth to make long-term improvements and improve their property’s energy efficiency.
This could include installing double glazed windows, installing insulation or replacing boilers.
In the first three months of the year, Legal and General Home Finance said a quarter of existing customers drew down funds to supplement and support everyday living expenses.
The lender said new customers released 24 per cent of equity from their homes on average, meaning customers could access more than £74,000 from a lifetime mortgage.
Gifting to younger generations remains a popular use at around nine per cent, with around 13 per cent of new applications citing the reason for taking out a lifetime mortgage as gifting.
New application data shows that nearly a quarter use equity release drawdown for paying off an existing mortgage.
Craig Brown, Legal and General Home Finance’s chief executive, said: “For those nearing or at retirement, accessing wealth tied up in the home can play a significant part of later life planning and for many people, property is their most substantial asset, even with recent challenges in the market.”
He added: “Our data shows lifetime mortgages are playing an important role in long term financial planning and that making a home comfortable and sustainable in the long term continues to be a popular use for funds.
“We also know that many people see releasing equity from their property as a way to provide a ‘living inheritance,’ with the opportunity to see loved ones benefit from the money when they need it most.”
“It’s important to note that equity release is a lifelong financial commitment and won’t be suitable for everyone. Anyone considering applying for a lifetime mortgage must speak to a financial adviser to be clear about all the options available to them,” Brown noted.