What is Equity Release on a House & How Can It Work for North London Homeowners?

Equity release lending increased by around 11% in 2025, with more homeowners choosing to unlock the value in their properties without selling up. One of the reasons behind this trend is that equity release product pricing has improved and more people over 55 are taking the opportunity to release some of the value tied into their property. 

In the last 25 years, the average property price in England has increased from £71,000 to £293,000, so homeowners who have owned property for a long time will usually have significant value locked into their home. In north London areas, such as Cricklewood, Dollis Hill and Kilburn, there has been even larger price increases, with Brent average prices increasing from around £139,000 to over £540,000 in this same period. 

This means that many homeowners can release some value in their property for a more comfortable retirement and still be able to leave some inheritance to loved ones. If you are considering taking out an equity release product, here is an overview of how it works and some of the pros and cons to help you make your decision. 

What is equity release? 

Equity release is a mortgage product that allows homeowners to access the money that is tied into the value of their home. Instead of selling the property to release equity, taking out an equity release product means homeowners can continue living in the property and release money from the value in their home.  

The cash can be used for any type of purpose; some people gift money to family, pay for holidays or make home improvements, for example.  

Why release equity from my north London property? 

Property values in north London have increased significantly over time but if you do not want to sell your property, your property wealth remains tied into your home. However, with equity release, you can use some of the equity accumulated in your home without selling. This can provide extra funds for retirement, and you can gift money to family members rather than waiting until it is left in your will. 

Some of the most common ways homeowners use cash from equity release is for making home improvements, taking holidays or even buying a holiday home. 

How do I release equity from my property? 

To release equity in your property, you will need to meet the eligibility criteria, which includes being aged 55 or over and providers will generally require a certain amount of equity in the property. Speaking to a financial adviser is recommended, so that you can discuss your options and find the most suitable product if you decide to go ahead with releasing equity. 

The next step is to apply with your chosen equity release provider and decide whether you prefer a cash lump sum or regular payments. 

What are the different equity release options? 

There are two types of equity release options: 

• Lifetime mortgage – This is the most common type of equity release product, and it involves taking a loan against your property and you continue living in your home. Interest rolls up on the loan amount and when you die or move into long-term care, the loan plus compounded interest is paid off when the property is sold. You can choose to release money as a tax free cash lump sum or take smaller amounts over time. 

• Home reversion plan – A home reversion plan involves selling a percentage of your property in exchange for cash or income. This type of equity release is usually only available for homeowners aged over 65. When the property is sold, either when you move into long-term care or you die, the percentage the provider owns is paid back, based on the current value and not the value when you originally sold the percentage. 

What are the pitfalls of equity release? 

One of the main pitfalls of equity release is that the interest rolls up, so over longer periods of time it can become substantial. Another factor to consider is that it will mean leaving less inheritance to family members. There are also early repayment charges, so if you decided to move home, you could end up paying a large fee to exit the product. 

If you have an existing mortgage, you will be required to pay off the outstanding mortgage amount you owe as part of the plan. 

What are the pros & cons of equity release? 

Who provides equity release options? 

There are many well-established equity release providers in the UK, including insurance firms like Aviva and Legal & General. If you are considering taking out an equity release product, you can check which ones are members of the Equity Release Council, which ensures they meet product standards, which include fixed or capped interest rates. 

Equity release can be a suitable option for some homeowners but there are several drawbacks to consider. An alternative way to release money from your property is to downsize, which as well as providing extra funds, can have practical benefits too, such as lower energy bills and less maintenance. 

If you are exploring the idea of downsizing, we can help you with your property plans. Get in touch with our team to discuss your ideal property preferences in areas such as Queens Park, West Hampstead and Willesden Green.