The amount of money people are borrowing against the value of their homes is rising according to new official figures.
Homeowners released an estimated £14.6bn in the final quarter of 2006 through mortgage equity withdrawal, the Bank of England said. Mortgage equity withdrawal totalled £49.7bn for 2006 as a whole, up from £36.6bn the previous year.
Leading economists suggest that rising mortgage equity withdrawal could bolster consumer spending on the High Street.
The above figures suggest that in the short-term, the recent strength in the housing market will support consumer spending. Despite higher interest rates, households are still keen to unlock money tied up in their house into a more fluid form.
People have been warned that if house prices were to fall, homeowners could live to regret their decision to borrow against the value of their home.
The market however continues to believe in the short term that price falls are not expected short term.
