What the numbers mean
Taken together, the data describes a market that is meaningful but modest against the property wealth older households hold. In our reading, three points stand out. Each is analysis rather than a forecast, and none of it is advice for any particular person.
First, the recent dip is a change of pace, not a collapse. Quarterly lending moved within a fairly narrow band and the first quarter of 2026 came in at £574 million, down 14% year on year, which the Council links to economic uncertainty delaying completions rather than a loss of interest (Equity Release Council, Q1 2026, published May 2026). Averages of this kind can rebound as quickly as they fall.
Second, drawdown behaviour matters. Returning drawdown customers, 7,019 in the first quarter of 2026, outnumbered new plans of 4,868, which suggests many people take a smaller initial sum and return for more over time rather than releasing a large lump at once (Equity Release Council, Q1 2026, published May 2026). That staged approach can affect how much interest rolls up.
Third, the sums are large in personal terms. An average new lump sum of £121,196 is a significant slice of a typical estate, and because interest on a lifetime mortgage generally compounds, the amount owed can grow over the years the plan runs (Equity Release Council, Q1 2026, published May 2026). Whether that is a reasonable trade depends entirely on individual circumstances, which is why regulated advice is required before taking a plan.
The statistics show what the market is doing on average. They cannot tell any one household whether equity release suits its plans, its family or its tax position.
Where equity release fits with wider planning
Equity release is a regulated financial product, and taking it out can touch several other parts of an estate plan at once. Releasing money from a home reduces the value that later passes to family, which changes the inheritance tax picture, and it can affect entitlement to means-tested benefits and how later-life costs are met. These interactions are general points, not recommendations, and many people choose to work through them with a qualified professional before acting.
On tax, money released and spent leaves the estate, while money released and kept or gifted may still count. How a home is treated for inheritance tax is set out in our guide to inheritance tax on property, and the thresholds that decide whether tax is due are covered in Inheritance Tax Explained. The standard inheritance tax rate is 40% above the available tax-free thresholds, with a nil-rate band of £325,000 per person, and these thresholds are frozen until the end of the 2030-31 tax year (5 April 2031) (gov.uk, as at July 2026, subject to change).
On later-life costs, releasing and giving away equity to reduce the value of an estate can be treated by a local authority as deprivation of assets when it assesses what someone can afford towards care, and a deliberate attempt to reduce assets can be challenged (gov.uk, paying for your care, as at July 2026, subject to change). For that reason, equity release is better understood as one option some households consider for funding retirement, rather than a route to limit the impact of care fees. Where equity release is being weighed alongside a will, gifts or trusts, it can be worth setting it in the context of a wider estate planning guide. Because it is regulated, equity release can only be arranged through an FCA-authorised adviser, who is required to assess suitability first.
Sources and methodology
The figures on this page come from two named sources, each verified against its published release. Market data is clearly attributed industry data from the Equity Release Council, whose members account for the large majority of the regulated equity release market; wealth data is official statistics from the ONS. Where a figure is an average, it describes the market and not any individual outcome.
- Equity Release Council, Q1 2026 market data, published May 2026: total lending, plan and customer volumes, and average loan sizes for the first quarter of 2026, plus comparative figures for Q1 2025 and Q4 2025 (equityreleasecouncil.com).
- Equity Release Council, Q2 2025 lending figures, published July 2025: total lending, customer volumes and average loan sizes for the second quarter of 2025, and the Q2 2024 comparison (equityreleasecouncil.com).
- ONS, Household total wealth in Great Britain: April 2020 to March 2022, released 24 January 2025: median household wealth by age, property wealth as a share of total wealth, and wealth by ownership status (ons.gov.uk).
- gov.uk, Inheritance Tax: nil-rate band, standard rate and the freeze to the end of 2030-31 (gov.uk/inheritance-tax).
All figures are as at July 2026 and subject to change. Market data reflects Equity Release Council members and may not capture the entire market.
Frequently asked questions
How much equity release is taken out in the UK each year?
Equity release lending is measured in hundreds of millions of pounds a quarter. In the first quarter of 2026, UK equity release lending was £574 million across 12,958 new and returning customers, down 14% on the same quarter a year earlier (Equity Release Council, Q1 2026, published May 2026). Quarterly totals move around, so annual figures depend on which quarters are added together. Source: Equity Release Council, Q1 2026, as at July 2026, subject to change.
What is the average equity release amount?
In the first quarter of 2026 a new lump sum customer released an average of £121,196, while a new drawdown customer took an initial £62,633 (Equity Release Council, Q1 2026, published May 2026). An average is not what any one person would be offered, which depends on age, property value, health and lender criteria. The figures describe the market rather than a personal entitlement. Source: Equity Release Council, Q1 2026, as at July 2026, subject to change.
Is the UK equity release market growing?
It grew for much of 2025 and then eased in early 2026. Quarterly lending rose to £636 million in the second quarter of 2025 before falling to £574 million in the first quarter of 2026, a 14% year-on-year drop the Council links to economic uncertainty rather than lost demand (Equity Release Council, Q1 2026, published May 2026). Short-run figures can move either way. Source: Equity Release Council, Q1 2026, as at July 2026, subject to change.
How much property wealth do older households hold?
A great deal. Net property wealth made up 40% of all household wealth in Great Britain in April 2020 to March 2022, and median household wealth peaked at £502,500 for households headed by someone aged 65 to 74 (ONS, released 24 January 2025). This concentration of wealth in homes is part of why equity release is discussed in later life. Source: Office for National Statistics, as at July 2026, subject to change.
Does equity release affect inheritance tax?
It can, because releasing money reduces the value of the estate that later passes on. Money released and spent leaves the estate, while money released and kept or gifted may still count. The standard inheritance tax rate is 40% above the available thresholds, with a nil-rate band of £325,000 per person, frozen until the end of 2030-31 (gov.uk, as at July 2026, subject to change). Outcomes depend on individual circumstances.
Can equity release be used to reduce care fees?
It is not a reliable way to do that. If someone deliberately reduces the value of their assets, for example by releasing and giving away equity, a local authority can treat this as deprivation of assets when assessing what they can afford towards care (gov.uk, as at July 2026, subject to change). Equity release is better seen as one option for funding retirement, discussed with a qualified professional.
Do these statistics apply across the whole UK?
The equity release market figures cover Equity Release Council members across the UK, and lifetime mortgages are regulated on a UK-wide basis. The ONS wealth figures cover Great Britain rather than the whole UK, so Northern Ireland is not included in those wealth statistics (ONS, released 24 January 2025). Legal and tax rules can also differ between the UK nations.
About Fairchild Oldfield
The Fairchild Oldfield team brings together estate planning, tax, independent financial advice and client care, working with families across England and Wales.
Fairchild Oldfield are estate planning specialists and will writers, not a firm of solicitors. This article is general information based on practical experience, not legal, tax or financial advice, and it is not advice about any regulated product such as equity release.
Important: This article is general information only and is not legal, tax or financial advice, nor advice about any regulated product. Reading it does not create a professional relationship. It is based on the law of England and Wales, and other UK jurisdictions may differ. Equity release is a regulated product that can only be arranged through an FCA-authorised adviser. Statistics and rules are current as at July 2026 and are subject to change. Before acting, many people choose to seek advice from a suitably qualified professional, such as a solicitor, a STEP practitioner, an accountant, or an FCA-authorised financial adviser, who can consider their individual circumstances.
