For many homeowners, the property they live in is more than just a roof over their heads. It represents family history, personal comfort, and often their largest financial asset. Yet as houses age and lifestyles change, even the most beloved home needs improvement. Whether it’s modernising kitchens, making accessibility adaptations, or investing in energy-efficient upgrades, the cost of improvements can run into tens of thousands of pounds.
Traditionally, those costs might have been met through savings or by remortgaging. But for homeowners aged 55 and over, equity release — typically through a lifetime mortgage — has emerged as a practical way to fund renovations without selling up. By unlocking the wealth tied up in property, borrowers can invest back into their homes while retaining ownership and the right to stay there for life.
This article explores how equity release is being used for home improvements in 2025, why it has become so popular, and what homeowners need to consider before proceeding.
The desire to improve homes is not new, but in 2025 several factors are driving higher demand. Energy costs remain volatile, encouraging households to invest in insulation, solar panels, and other green technologies. The government’s focus on sustainability has also created incentives for energy-efficient retrofits.
Meanwhile, demographic changes mean more people are planning to stay in their homes for longer. Rather than downsizing, many retirees want to adapt their properties with accessibility features such as stairlifts, walk-in showers, or single-storey extensions. In addition, the rise of multi-generational living means properties are often being remodelled to accommodate children or grandchildren.
All of these improvements require funding. For many older homeowners, their pensions and savings are insufficient to cover the costs, but their homes have built up significant equity over decades. This is where lifetime mortgages step in.
A lifetime mortgage allows homeowners to release cash from their property without making monthly repayments, unless they choose to. The loan, along with any rolled-up interest, is usually repaid when the homeowner dies or moves into long-term care.
For home improvements, this can be particularly powerful. Instead of moving house to achieve the lifestyle they want, borrowers can adapt their existing property. For example, a £50,000 release could fund a new kitchen, an extension, or the installation of renewable energy systems. Unlike unsecured loans, the borrowing is secured against the property, meaning larger sums are typically available at competitive rates.
Modern products also offer flexibility. Borrowers may take a lump sum to fund a single large project, or set up a drawdown facility to access funds gradually for phased improvements. This helps manage interest costs, since interest is only charged on the amount actually withdrawn.
For many clients, the appeal of equity release for home improvements is not just financial, it’s emotional. Staying in the family home, maintaining community ties, and preserving cherished memories are priorities for many. Renovating rather than relocating allows them to improve their quality of life without sacrificing those connections.
There are also practical benefits. Improving a property can increase its market value, offsetting some of the long-term impact of rolled-up interest. Energy-efficient upgrades, in particular, can reduce monthly bills, providing ongoing financial benefits. Adaptations for accessibility can also help homeowners maintain independence for longer, reducing potential care costs in the future.
As with any form of equity release, there are important considerations. Using a lifetime mortgage for home improvements will reduce the value of the estate passed on to beneficiaries. Unless repayments are made, the loan balance will grow over time as interest compounds. Borrowers must weigh the immediate benefits of home improvements against the long-term impact on inheritance.
There are also practicalities to consider. Large projects require careful budgeting, and not all renovations add value to a property. Borrowers should ensure that improvements are cost-effective and aligned with their future needs. Solicitor involvement, as required for all equity release transactions, ensures legal clarity, while regulated financial advice ensures suitability.
Equity release is not the only way to fund home improvements. Some homeowners may prefer to downsize and move into a property that already meets their needs, though this comes with disruption and transaction costs. Others may explore retirement interest-only mortgages, which involve ongoing monthly payments but preserve the estate more effectively.
Unsecured personal loans or remortgages are other potential options, but affordability tests and age restrictions can make them inaccessible for many older borrowers. Equity release remains attractive because it requires no affordability assessment and provides flexibility. The key is to compare all available solutions before committing.
The evolution of the equity release market has made it a far more responsible option in 2025 than in the past. Thanks to the safeguards of the Equity Release Council, borrowers benefit from protections such as the no-negative-equity guarantee, the right to remain in their home for life, and mandatory independent legal advice.
When used responsibly, equity release can do more than provide cash — it can transform quality of life. A well-timed home improvement project can make retirement more comfortable, sustainable, and enjoyable. For many, that benefit outweighs the reduction in inheritance.
Equity release is increasingly being used to fund home improvements, offering a way for homeowners to unlock the value in their properties and reinvest it back into the place they love most. Whether it’s upgrading kitchens, making homes more energy efficient, or adapting for accessibility, lifetime mortgages are helping older homeowners achieve their goals without selling up.
While not suitable for everyone, equity release is now a mainstream, safeguarded option that deserves careful consideration. With regulated advice, solicitor oversight, and a clear plan, it can be a smart way to make home improvements while preserving the comfort, independence, and familiarity of the family home.
About the Author
Wesley Ranger is the Founder and Director of Willow Private Finance, where he also serves as a senior mortgage and protection specialist. With more than 20 years of experience,
Wesley has helped clients unlock property wealth responsibly to meet a range of needs, from estate planning to later-life living. His expertise in lifetime mortgages and equity release ensures that clients approach home improvements with clarity, confidence, and the security of regulated advice.
Important Notice
Equity release and lifetime mortgages are regulated financial products. They may not be suitable for all borrowers and will reduce the value of your estate. Taking out a plan may affect your entitlement to means-tested benefits. Interest can accumulate significantly unless payments are made, which may increase the balance owed. Independent, regulated advice is mandatory before entering into any equity release arrangement. This article is for information purposes only and does not constitute personalised financial advice.
