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Most Affordable Mortgage Payments Are in the North

Mortgage payments as a percentage of income edging towards 1996 record-low

UK Mortgage Market News

New research by Halifax suggests that mortgage payments are approaching one of their most affordable levels in more than 20 years.

According to the data, payments accounted for less than a third, or 29%, of a homeowner’s disposable income in Q4 2017, putting them below the long-term average of 35% between 1983-2017.

By comparison, nearly half (47%) went towards a mortgage in 2007. However, the lowest figure recorded was in 1996, when mortgage payments took up just 23.6% of an income.

Halifax’s data also reveals that there were significant differences in regional mortgage payments as a percentage of disposable income.

London had the highest percentage at 44.8%, whilst the most affordable mortgage payments in England were in the North (20.6%), Yorkshire & the Humber (23%) and the North West (23.1%).

Payments were also more affordable than the national average in the East Midlands, East of England and the West Midlands, with percentages of 26.9%, 28.4% and 29% respectively.

Commenting on the figures, Halifax’s mortgage director Andy Bickers said: “Improved mortgage affordability has been a key factor supporting housing demand and helping to stimulate the modest recovery that we are currently seeing.”

Recent declines in supply have caused a surge in asking prices in March according to Rightmove, with the highest increases recorded in the Midlands, the North West and Wales.

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