Home owners spending less on mortgage
In November, house buyers used less of their household income to cover their interest payments that at any other time since 2005, latest figures have indicated.
According to the Council of Mortgage Lenders CML, home movers needed only 10.6 per cent of gross income to cover such monthly payments, down from 11.1 per cent in October.
The burden of debt on first-time buyers has also reduced, with 14.4 per cent of gross income needed in November, down from 15.1 per cent the previous month.
CML director general, Michael Coogan, commenting on the data, said it was “encouraging” to see mortgage interest payments “so affordable” for many homeowners.
“But with substantial deposits still needed to secure a mortgage, the market will continue to be relatively restrained for some time to come,” he stated.
“With refinancing still unattractive or unnecessary for many borrowers due to continuing low rates, we are now seeing a much more house purchase-focused market.”
Last week, the CML reported that overall lending increased to £13.7 billion – a 14 per cent rise on November – which potentially is good news for buyers seeking cheap mortgage rates.