The amount of money generated by equity release deals in the first half of 2015 rose by almost a fifth according to figures from Key Retirement.
The firm said that homeowners cashed in more than £750 million of property wealth in the first six months of the year, up from £641 million between July and December 2014.
The average amount of equity unlocked rose from £65,000 to £68,500 and there was a 10% uplift in the number of plans put in place. The majority of customers are using the money they released to pay off existing debts: 23% are using the cash to help clear mortgages while a further 29% are using it to pay off personal loans or credit card balances.
Dean Mirfin, technical director at Key Retirement, said: “Property wealth is making a massive contribution to retirement planning and the equity release market is growing rapidly in response with double-digit growth.
“The average amounts released at £68,500 are more than 50% bigger than the average pension pot and are also tax-free, highlighting the advantages of using property wealth in retirement.
“Cuts in pension allowances and contribution levels plus the review of pension tax treatment underlines that property investments are major assets which should be considered as part of anyone’s retirement planning.”