Almost one in three retirees accessing equity in their property use the proceeds to fund holidays or buy holiday homes, a new survey by equity release specialist Key Retirement has found.
A survey of 2,197 people over-55, all of whom had released equity in their home, found that 30 per cent were using some of the money for these two purposes.
The average sum spent on a holiday was £6,785, while the average spent on a holiday home was £58,850.
Overall, the survey found those opting for equity release were accessing on average £72,000.
Residents of south-east England, where property prices are highest, were the most likely in the UK to use property equity to pay for an overseas trip, with men twice as likely as women to go down the equity release route.
Property wealth is providing the opportunity for over-55s to visit places they have previously only dreamed of.
The research found the proceeds were often used to visit relatives in expensive locations such as Australia, New Zealand, Canada and the US.
It found Spain remained a popular place to own a holiday home.
Dean Mirfin, technical director at Key Retirement, presented the findings in a positive light, saying retirees were unlocking cash from their homes “to improve their lifestyle in retirement”.
He said: “Whether it is jetting off to exotic climates, purchasing a holiday home or visiting relations in far-flung corners of the world, property wealth is providing the opportunity for over-55s to visit places they have previously only dreamed of.
“It is also enabling many to have a second home in the UK or abroad, which for many would not be possible without access to the wealth tied up in their main homes.”
But financial adviser Christopher Foster, a retirement specialist with Pennines IFA, said he never advised his clients to release equity from their property.
He said: “I’ve seen cases where people have bitterly regretted equity release, because they are selling their future,” he said, adding that people should be “extra, extra careful” before deciding to go down that road, saying there were usually cheaper ways of raising money.
However, he conceded that every case was different, and while equity release was not appropriate for his clients, it may be suitable for some, particularly those who were “asset rich but cash poor”, and those who had no childre