The Miles Review
The UK Mortgage Market: Taking a longer-term view
Final report and recommendations
The Final Report of Professor David Miles’ Review of the UK mortgage market was published on Friday 12th March. The Report makes recommendations to remove obstacles to the development of a market where a larger proportion of mortgages are at interest rates that are fixed for more than a few years.
The UK Mortgage Market: Taking a Longer-Term View is available below in Adobe Acrobat Portable Document Format (PDF). If you do not have Adobe Acrobat installed on your computer you can download the software free of charge from the Adobe website . For alternative ways to read PDF documents and further information on website accessibility visit the HM Treasury accessibility page .
Section 1 of the Report sets out the aim and scope of the Review. Section 2 considers optimal mortgage choice. Section 3 summaries the potential macroeconomic implications of more long-term fixed-rate lending. The recommendations for how the market can be made to work better are then presented in the main body of the Report, in Sections 4 to 7. Recommendations are summarised in Section 8.
The Interim Report was published on Tuesday 9th December. The Report analysed why there is so little mortgage lending in the UK where the interest rate is fixed for more than a few years and considered whether there are obstacles to the development of a larger market where interest rates are fixed for periods longer than is currently common.
David Miles is Professor of Finance at Imperial College, University of London. He has long specialised in the economics of financial markets, pensions and housing.
Terms of reference
In his Budget statement on April 9th 2003 the Chancellor announced that David Miles would lead a review of the UK mortgage market. The terms of reference for the review are as follows:
- Undertake analysis of supply and demand side factors limiting the development of the longer-term fixed-rate mortgage market in the UK to establish why the share of longer-term fixed-rate mortgages is so low compared to the United States and many other EU countries;
- Consult with key stakeholders to establish views and inform analysis;
- Examine whether there has been any market failure that has held back the market for longer-term fixed-rate mortgages and consider associated opportunities, risks and potential costs; and
- Deliver an interim report by autumn and a comprehensive report and recommendations to the Chancellor by Budget 2004.
Enquiries regarding the Report should be addressed to the Correspondence & Enquiry Unit
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