Young buyers spending more on mortgage

13-Feb-2008

First-time buyers do not appear to be dissuaded from entering the property market at present, as figures show they are using around a third of their income on their mortgage.

Statistics from the Council of Mortgage Lenders (CML) show that repayments on mortgages are taking up around 35 per cent of first-time buyers' disposable monthly income.

This is largely due to the house price boom which has resulted in borrowers having to take out average loans of £118,000 as compared to just £71,000 five years ago, reports Thisismoney.

However, the situation is made worse by increases in household necessities such as food and energy, the report continues.

Additionally the figures show that an increasing number of first-time buyers are having to pay stamp duty on their property, with just 38 per cent of buyers managing to sidestep the tax.

The CML is the trade association for the mortgage lending industry with members accounting for around 98 per cent of UK residential mortgage lending.

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