Home loan repayments in the UK for qualified borrowers are now at its most affordable level since 1997, accounting for more than 25 percent of take-home pay, according to mortgage lender Halifax.
“Mortgage payments for a typical new borrower currently account for the lowest proportion of earnings for 15 years,” said Martin Ellis, Chief Economist at Halifax.
Overall, mortgage repayments as a percentage of earnings have declined by almost half since the market peak of 48 percent five years ago. The drop is attributed to low interest rates and weak home prices in most parts of the country.
The biggest drop in typical mortgage repayments as a percentage of income was recorded in Northern Ireland, where the rate has fallen by around two-thirds.
At the same time, repayments in Scotland, Humber, Wales and Yorkshire have fallen by almost 50 percent in five years and to around 35 percent from 56 percent in London.
Moreover, Scotland now has the 10 most affordable areas, with loan repayments at about 15 percent of disposable earnings in East Ayrshire.
In contrast, the least affordable areas are in London and the South East, with repayments in Kensington and Chelsea reaching as high as 76.6 percent of take-home pay.
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