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Homeowners continue to cut debt - BBC
Cannon_Fodder
Posts: 3,980 Forumite
http://newsvote.bbc.co.uk/1/hi/business/7976111.stm
"Homeowners are increasingly paying off their mortgages under the impact of falling house prices and lower interest rates, Bank of England figures show.""Housing equity withdrawal, where home owners cash in on the increased value of their homes, has now reversed for nine months in a row.
A further £8bn of mortgage borrowing was paid off between October and December, the Bank said."
Not posted just for the good MSE sense being displayed by a fair number of people.
But also for the snippet;
"More than £300bn has been borrowed through equity withdrawal since 2000."
I know MEW figures are on BoE's website, but had not added it up...that's a fair whack...
"Homeowners are increasingly paying off their mortgages under the impact of falling house prices and lower interest rates, Bank of England figures show.""Housing equity withdrawal, where home owners cash in on the increased value of their homes, has now reversed for nine months in a row.
A further £8bn of mortgage borrowing was paid off between October and December, the Bank said."
Not posted just for the good MSE sense being displayed by a fair number of people.
But also for the snippet;
"More than £300bn has been borrowed through equity withdrawal since 2000."
I know MEW figures are on BoE's website, but had not added it up...that's a fair whack...
0
Comments
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Cannon_Fodder wrote: »http://newsvote.bbc.co.uk/1/hi/business/7976111.stm
"More than £300bn has been borrowed through equity withdrawal since 2000."
I know MEW figures are on BoE's website, but had not added it up...that's a fair whack...
But not enough to support GDP for the last 9 years like some have surgested.
Looks like the "sheeple" (God I hate that term) are not as dumbs as many thought or made out.
That works out that it is being paid back at the same rate it was being withdrawn.0 -
Actually,
"This (MEWing) gave a huge boost to the after-tax incomes of the average household in the decade leading up to early 2008. This hit a peak in late 2003 when the extra borrowing increased household incomes by 8.5%."
I'd say an 8.5% increase on average household incomes was quite a lot, actually.
Especially when you think how many didn't do it - that leaves some people who borrowed an awful lot of money.
Obviously, the figures are skewed by the very low interest rates - people are throwing loads of 'free money' courtesy of interest rates at their mortgages in the desperate hope of getting within a reasonable LTV for when they have to remortgage.
TBH, I'm surprised it's not much higher. With interest rates this low, if they can only afford to pay back 8bn of it, that's really very little.0 -
Partly due to the banks reluctance to reduce SVR's, many people have worked out you get a better return reducing a mortgage debt with IR of around 4.5% than try and save at 1-2%.0
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