Mortgage Equity Withdrawal UK 2006-2007

Current Trends in Mortgage Equity Withdrawal UK 2006-2007

Mortgage equity withdrawal has increases significantly in the past 6 years. In 2000 MEW accounted for just under 2% of personal disposable income. In 2003 this shot up to 9% of personal disposable income (£18bn). After a fall in the growth during 2004, MEW has again picked up in 2006. Bank of England

These trends in MEW are very closely tied to the performance of the UK housing market and also interest rates. The peak in 2003 a reflection of the historically low interest rates.

Prospects for Mortgage Equity Withdrawal in the UK.

There are fears that the UK house prices are overvalued. If house prices were to fall then it could lead to a significant fall in MEW. Also the recent rise in interest rates have made re mortgaging less attractive; the prospects for future interest rate rises remain.

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