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Cheap mortgages help property more affordable

Date: Mon, 05 Jun 2006

Even though house prices have continued to rise, the growing number of cheap mortgage deals has helped to ensure property remains affordable.

New research from Alliance & Leicester shows that property is at its most affordable for over two years and that many first-time buyers are looking to use cheap mortgages to help them step on to the property ladder.

In the first three months of 2006, interest payments on a new mortgage accounted for 14 per cent of household income compared to 27 per cent of income in 1990.

It is estimated that 16 per cent of under-30s are planning to buy a property this year and 15 per cent of UK households are considering moving or remortgaging – double the number at the start of the year.

"We are seeing greater confidence in the mortgage market from consumers," said Chris Rhodes, managing director of Alliance & Leicester retail banking.

"It's particularly pleasing to see the increased confidence amongst the under-30s. Increased first-time buyer activity enables others to move up the ladder," he added.


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