Money released from property equity is being used for property purchasing and home improvements more and more, according to Canada Life data.

The lender’s analysis of its own customers shows that, in the first two quarters of 2020, equity release was used to fund a new property by 8 per cent and 6 per cent of borrowers, respectively.

In Q3 and Q4 of last year this had jumped to 16 per cent and 18 per cent of applications, respectively.

And at the same time, applications for home improvements were steady throughout the year, ranging from 39 per cent in Q1 to 36 per cent in Q4.

The most popular reason people applied for equity release throughout 2020 was to complete a mortgage payment, at 45 per cent.

Canada Life head of marketing, insurance Alice Watson says: “Looking at the reasons why people have chosen to use their property wealth can provide an interesting snapshot into the spending priorities of the nation during the pandemic. For example, the boom in new property purchases is likely to have been fuelled by the stamp duty holiday announced in the summer Budget.

“It is largely unsurprising, that 2020 a year dominated by lockdowns and restrictions has seen a drop in people using equity release to go on holiday. While this decline is expected it will be interesting to see whether the rollout of the coronavirus vaccines will lead to the beginning of a resurgence in travel.

“The popularity of home improvements is also particularly fitting for the year that many of us stayed home, within our own four walls.”