U.K. Households Step Up Debt Repayments

chucky

setmefree2 wrote: »

It's the highest figure ever - how can that be a non-story?

because it's good news

just as people are paying down extra money on their mortgage it will be an increase in equity for the future regardless of the current house prices.

that will be when the spending will occur and the people that missed out on property previously will have missed out on that equity 'wealth'. for some it will be again.

cocktail

setmefree2 wrote: »

Most people don't have to or won't to sell sell so MV is irrelevant to the majority. What is important to most people is the percentage of their house they own - MVs change so it's an irrelevance.

or remortgage . i actually agree with you setmefree2

cocktail

carolt wrote: »

How astonishing.

Interest rates are at their lowest for several hundred years, so people's mortgage interest payments are going down massively - and - at the same time, their house prices are shooting down, thus requiring them to pay more capital off their mortgages to avoid neg equity/stay within their desired LTV.

Isn't it amazing they would choose to put some of that money they've saved on their mortgages towards paying off the capital? :rolleyes:

It's not rocket science, is it.

well so people are doing the sensible thing. not all though, extra cash in the bank so more for the high street for some.

mewbie_2

Spiv wrote: »

Britons increased the equity in their homes at the fastest pace on record...

Is this a joke? Very few will have managed to pay off morgage as fast as prices are dropping, that's what happens with massive geared borrowing - which is what a mortgage is.

For example - I own a 100k house. It is dropping at a minimum of 1% a month. That's a thousand quid a month. Not many can pay a thousand a month of their mortgage.

So unlike to be a increase in equity. Maybe a lessening of debt, which is a whole other story. Although debt in relation to equity probably rose.

Stats and journalists eh, plus a few bulls. Must try harder - 3/10.

chucky

mewbie wrote: »

Is this a joke? Very few will have managed to pay off morgage as fast as prices are dropping, that's what happens with massive geared borrowing - which is what a mortgage is.

For example - I own a 100k house. It is dropping at a minimum of 1% a month. That's a thousand quid a month. Not many can pay a thousand a month of their mortgage.

So unlike to be a increase in equity. Maybe a lessening of debt, which is a whole other story. Although debt in relation to equity probably rose.

Stats and journalists eh, plus a few bulls. Must try harder - 3/10.

you haven't mentioned reducing the capital each month on their monthly repayments so it may have been the case.

carolt

setmefree2 wrote: »

It's the highest figure ever - how can that be a non-story?

Of course it's the highest figure ever! It's not happened for donkeys years, and prices are way higher than whenever it last happened - (did it ever)?

So of course it's the biggest figure.

But given how much interest rates have fallen - we're talking lowest rates for hundreds of years here! it would be pretty weird if it didn't make an impact.

I'd just expect it to be higher.

If all those people with their 1p mortgages aren't paying off capital now, what the bleeding heck are they doing with it?!

mewbie_2

carolt wrote: »

If all those people with their 1p mortgages aren't paying off capital now, what the bleeding heck are they doing with it?!

They are saving in case they lost their income, or have already lost it. In a lot of cases they are thinking "free money, let's spend", but I suspect the "free money" is actually enabling them to pay bills, higher taxes, etc.

So what happens as unemployment, and interest rates, and inflation rise? The bull posts will get ever more angry and hysterical I guess.

arcalis

carolt wrote: »

Absolutely agree.

My point was that it was a bit of a non-story. I'm surprised the figures weren't much higher - I'd expect with interest rates at historic lows, people could manage to pay off more.

I wouldn't quite say its a non story. The £8 billion repaid in equity in the last quarter is exactly the same as the average amount borrowed through equity release since 2000.
Now this is only a non story if the 'record' MEWing was too, which i'd suggest would not sit too well some posters here.

With last quarter ending in Christmas (doesn't take a rocket scientist, i know) these figures could be construed to be surprising especially as retail sales were up in January.

cocktail

carolt wrote: »

Of course it's the highest figure ever! It's not happened for donkeys years, and prices are way higher than whenever it last happened - (did it ever)?

So of course it's the biggest figure.

But given how much interest rates have fallen - we're talking lowest rates for hundreds of years here! it would be pretty weird if it didn't make an impact.

I'd just expect it to be higher.

If all those people with their 1p mortgages aren't paying off capital now, what the bleeding heck are they doing with it?!

some are saving it at a higher rate after tax.

cocktail

mewbie wrote: »

So what happens as unemployment, and interest rates, and inflation rise? The bull posts will get ever more angry and hysterical I guess.

thats the time to ditch the ship and go overboard.