Last year saw the largest amount of equity release lending ever recorded as the market grew nearly 30%.
There were more than 21,000 new customers in 2014, the most recorded since 2008.
The total value of equity release lending hit almost £1.4 billion in 2014, according to the latest industry figures from the Equity Release Council.
This is the largest annual figure since records began in 1992 and is 14% higher than the previous high of £1.21 billion in 2007.
It marks a 29% leap from 2013, bringing the equity release market back above pre-recession levels.
The total number of new equity release customers in 2014 was 21,336, a 13% increase from 2013 and the largest yearly figure since 2008. Customer numbers have now grown for four consecutive years.
The average value of equity release lending also hit a new milestone in 2014, reaching £64,787.
This is an increase of 14% from last year and exceeds the previous record of £60,504 in 1998 by 7%.
Some 66% of new equity release customers chose drawdown products in 2014, against just 25% of customers in 2006.
Lump sum products now account for 34% of new plans while home reversion account for less than 1%.
Nigel Waterson, chairman of the Equity Release Council, said: "2014 truly has been a record-breaking year for the industry.
"Equity release is proving to be a crucial tool for financial planning in retirement, and is allowing retirees to improve their standard of living and give them more flexibility to support themselves or family members.
"The new pension freedoms won't change the fact that many people do not have enough savings for later life.
"There is a danger that people's pension pots will be here today, gone tomorrow', but housing wealth is the one constant that many in this generation can rely on for support.
"Increasing awareness of the available products and their benefits means that equity release will continue to thrive in 2015.
"With talk of mainstream lenders and new offers arriving in the market, we anticipate big things for equity release in the year ahead."
Geoff Charles, chief executive of equity release adviser firm Bower Retirement Services, welcomed the sharp rise in lending.
"Gone are the days when equity release was perceived as the black sheep of retirement finance. Now, this growing sector is becoming far more mainstream.
"Our own advisers predict that the market could double in size in the near future, as equity release becomes firmly embedded into the retirement finance landscape.
"We need responsible, expert advisers to guide the older generation through the options available and set them on the right financial course and equity release is becoming a useful path for many.
"As understanding among customers improves, and as the offerings become ever more flexible, the only way is up for equity release."
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