Homeowners continue to cut debt
http://news.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.
More than £300bn has been borrowed through equity withdrawal since 2000.
This 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%.
Last year though, the reverse process of increasing mortgage equity started to drain households of their cash.
In the last three months of 2008 this amounted to 3.3% of their after-tax incomes.
