If you have been finding it tough to pay your monthly mortgage payment over recent months, you are not alone. New research from Barclays has found that despite the affordability of mortgages reaching its best level for a decade, one in six homeowners are finding it harder to keep up their monthly mortgage commitments.
Mortgage affordability at ten year high
According to the Barclays figures, the average homeowner spent just 15.4 per cent of their take-home pay on mortgage repayments in December, the lowest level since the bank first started analysing home loan affordability in 2002.
The research analysed transactions from over one million current account and found that the historic low Base rate in addition to recent pay rises were responsible for the high levels of affordability.
The Independent reports that ‘the improvement in affordability comes despite the fact that house prices have risen by 68 per cent during the past 10 years, while average salaries have increased by only 37 per cent’.
16 per cent of Brits struggling to make mortgage payments
The research also found that 13 per cent of homeowners said that they could easily afford their home loan payments, whilst a further 29 per cent were ‘comfortable’.
28 per cent of respondents described themselves as being ‘stretched’ whilst 16 per cent admitted that their mortgage was now less affordable than it had been a year ago. Over a third said that this was because their salary was lower than it was in December 2009.
Andy Gray, head of mortgages at Barclays, said: “It stands to reason that with interest rates at an historic low, mortgage affordability is at its best in a decade, but it is crucial that homeowners are not complacent.
“When asked specifically about coping with rising interest rates, it was great to hear that 71 per cent say they either already have a plan in place to manage increased monthly mortgage repayments, or that they will be unaffected as they are on fixed rates.”
