People with mortgages 'have still built up sizeable amounts of equity'
Published On 5 February 2008
Many people with mortgages in the UK have still managed to build up a substantial amount of equity in their property, a new report has shown.Data released by GE Money Home Lending showed that 36 per cent of people in the country have a residential mortgage, but that the average borrower owns almost a third of their home.
This means that these people cumulatively have around £580 billion of equity.
What's more, the figures indicated that a quarter (26 per cent) of people have paid off their mortgage completely and have therefore amassed a staggering £1,377 trillion of property wealth.
"Whatever happens to the property market in the short term, we have had a prolonged period of rising prices which have - importantly - helped many homeowners to build equity and a reassuring cushion against any downturn," explained Gerry Bell, head of mortgage marketing at GE Money Home Lending.
"However, whilst consumers should take some reassurance from the equity that they currently hold in their homes, they also need to ensure that they are not complacent and continue to make prudent financial decisions - particularly in an environment of economic slowdown which could potentially see house prices falling."
Nationwide figures showed that house prices in the UK fell by 0.1 per cent in January.
