The cost of servicing mortgages has stabilised, according to research from Woolwich.
The lender found that the cost of servicing a mortgage debt remained at 18.6 per cent of householder’s disposable income during October, up 0.3 per cent on the same month in 2004. Average mortgage payments, however, rose by a pound to £512.
Woolwich’s survey discovered that London was the only area where mortgage servicing became more expensive, with repayments rising from 23.4 to 23.5 per cent of average disposable income between September and October 2004.
Meanwhile, the affordability of home loans improved the most in the East Midlands and Wales, dropping by 0.2 per cent to 16.3 per cent and 16.2 per cent respectively.
“As predicted last month, affordability is stabilising, which is a positive trend in the run up to Christmas when people tend to spend more of their disposable income preparing for the festivities,” said Andy Gray, head of mortgages for the Woolwich.
The survey looked at 1.3 million Barclays Group current account holders who service mortgage repayments from monthly income. Woolwich monitors affordability ratios monthly.
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