More retirees could be encouraged to apply for an equity release scheme after new research revealed that the value of privately-owned homes in the UK has nearly doubled since 2001.

Based on data from the Communities and Local Government department, banking giant Halifax has revealed that the value of the UK's private housing stock has increased by 84 per cent over the past ten years to £3.9 trillion. This £1.8 trillion rise in the value of homes is equivalent to £68,500 per household.

Although the total value of outstanding mortgage balances has more than doubled during the period to £655 billion, the sharp increase in the value of housing assets has boosted the overall value of housing equity. 

According to the figures, housing equity - the value of housing assets less the total value of outstanding mortgage balances - has increased by £1.1 trillion over the ten-year period to 2011 to £2.6 trillion.

Martin Ellis, housing economist at Halifax, said: "Whilst outstanding mortgage debt has more than doubled over the last ten years, the value of the housing stock has risen by more in monetary terms.

"As a result, the total value of housing equity has shown a healthy increase. For most homeowners housing is still very much the main store of private wealth."

The research also showed that the north-south divide has narrowed over the past decade, with the value of housing assets in the north increasing at a faster rate than in the south since 2001.

As a result of this, the south's share of total UK private housing sector assets has fallen from 60 per cent in 2001 to 58 per cent in 2011.

All 12 regions of the UK have seen a significant increase in the value of their private housing stock during the last ten years, with the biggest increase reported in Scotland (131 per cent).