Mortgages have reached their most affordable level in a decade with borrowers in the North East of England and Scotland spending the smallest proportion of their earnings on repayments, a new report has revealed.
At the end of 2017 homeowners were, on average, spending 29% of their disposable income paying back their mortgage, according to figures published by Halifax.
This is a huge reduction on the average of 48% being forked out by borrowers at the market’s peak at the end of 2007.
People living in Copeland, North East England were spending the least amount of disposable earnings on their mortgage (14.9%) followed by Inverclyde in Scotland (15.7%).
Meanwhile homeowners in Brent, London were being hit the hardest with average repayments at just over 61% of their income. In fact, London and the South East of England remain the least affordable areas of the UK.
Borrowers in Northern Ireland experienced the greatest improvement in affordability thanks to plummeting house prices, which have gone down by 44% in the region since 2007, Halifax revealed.
In one of its local authority districts, North Downs and Ards, mortgage payments as a proportion of disposable income plunged from 81% to 19% in ten years.
According to Halifax the improvement in affordability was largely down to the historically low mortgage rates.
Andy Bickers, mortgage director at Halifax, said these figures would provide a boost for anyone with a mortgage or for those taking their first step on to the property ladder.
He added: “Improved mortgage affordability has been a key factor supporting housing demand and helping to stimulate the modest recovery that we are currently seeing.
“In recent months we have seen the number of first-time buyers and homeowners purchasing a home with a mortgage bounce back towards 2007 levels, and mortgage payments becoming a much smaller proportion of disposable income across most of the country will also support a healthy market and more choice and opportunity for buyers [and] borrowers.”
