Equity release activity slowed in the first quarter of 2026, as economic uncertainty weighed on decision-making, according to the Equity Release Council.
Its latest figures for the three-month period revealed lending fell 9% quarter-on-quarter to £574 million and was down 14% year-on-year.
Total customer numbers also dropped, with 12,958 new and returning customers accessing property wealth; a 7% decline on the previous quarter and a 10% annual drop.
New volume plans fell 8% over the quarter, while returning drawdown customers saw a more modest decline of 2% to 7,019. Meanwhile, average loan size declined across most product types.
Despite the slowdown in lending, adviser feedback suggests underlying demand is resilient. Nearly half (45%) of firms reported an increase in enquiries compared to the previous quarter, compared to 33% who reported a decrease.
Almost two in five (38%) firms also saw an increase in applications during the quarter, versus 34% who saw a decline.
However, while customer interest has held up, the data found fewer cases are progressing through to completion in the current environment.
Will Hale, CEO of Key Equity Release, said: “The numbers are not a surprise given the uncertainty in the market in the run-up to the Budget in November last year and obviously more recently the geo-political environment that has seen rates increase and had a broader impact on customer confidence.
“However, at Key we have been encouraged by the level of customer demand that we have seen so far in 2026. The demand we are seeing reinforces the positive medium- to long-term outlook for the later life lending market. With over-60s owning more than £3.84 trillion of unencumbered property equity, the home has to be a major part of retirement planning for the future.”
Sadna Zaman, home finance proposition manager at Canada Life, shared a similar sentiment.
“Against a backdrop of geopolitical and macroeconomic uncertainty, it’s natural that customers have taken a more cautious approach to financial decision-making this quarter.
“Property wealth remains a significant and often underutilised part of many individuals’ overall financial position. The later life lending market offers a broad range of flexible solutions designed to meet different needs and circumstances as people approach and move through retirement and we, as an industry, should continue to emphasise the important role property wealth can play as part of a well-rounded, long-term financial plan.”
Brendan Gilligan, head of equity release proposition at Royal London, said from an adviser perspective, the figures reinforce the importance of careful structuring and robust suitability assessments.
He explained: “Clients are increasingly weighing equity release alongside alternatives such as downsizing, using other assets or delaying decisions until market conditions improve. Modern equity release products are far more robust than in the past but they remain complex and highly individual.
“When considered carefully, with full regard to long‑term implications, family circumstances and future needs, equity release can form an effective part of a broader later‑life planning strategy.”
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