Home loan repayments 'a priority'

Thursday, January 01, 2009

UK homeowners are no longer cashing in on the value of their properties to fund spending, official figures show.

Quarterly Bank of England figures on housing equity withdrawal showed a second successive negative reading between July and September.

Housing equity withdrawal is when owners take out bigger mortgages, extracting money to spend on major purchases such as cars.

But households put £5.7bn of equity back into homes in the third quarter.

This came after they put £2bn back into their homes in the second three months of the year as property prices started to fall sharply.

This is in stark contrast to £5.6bn housing equity withdrawn in the first three months of the year and £11.1bn withdrawn in July to September last year.

The latest data shows that people are concentrating on repaying their mortgage, rather than adding to their debts.

Source:

News.bbc.co.uk