The number of people choosing to boost their retirement income by mortgaging their home has exploded over the last ten years.
Equity release loans have increased twenty five fold in the past decade
The equity release market is 25 times the size it was in 1994, according to the Council of Mortgage Lenders (CML).
Under equity release, people sign over part of their home to a lender in return for a lump sum or income.
Britons borrowed £1.2bn through equity release in 2004, up 10% on 2003.
Low levels of pension savings could prompt more homeowners to rely on the increased value of their homes to borrow money in future, the mortgage industry body added.
"With such a huge pool of untapped housing wealth among older homeowners, many of whom may be disappointed with their pension provision, it is clear that there is a potentially huge market," said Jackie Bennett, a CML senior policy adviser.
The potential downside of using equity release to top up pensions is likely to be felt by the next generation, who may inherit less than they had hoped as the lender must be repaid when the home owner dies.