Mortgages 'will get more affordable in 2008'
Published On 12 February 2008
Cuts in interest rates in the UK over the past three months should help more people afford mortgages in the coming year, an industry expert has said.The Council of Mortgage Lenders (CML) acknowledged that affordability in the country severely deteriorated over the course of 2007, but suggested that the two rate cuts since December should help consumers find better mortgage deals.
According to CML figures, the typical first-time buyer in the UK had to spend 20.7 per cent of their total income servicing their mortgage debt in December.
"Affordability has been stretched further in 2007 but the recent base rate cuts and the expectation of future cuts will ease debt servicing burdens in 2008," explained CML director general Michael Coogan.
"The impact of payment shock on the large numbers of borrowers coming to the end of fixed-rate mortgages will also be less than we anticipated last year.
"For first-time buyers, the combination of subdued house price inflation and lower mortgage rates means affordability should ease slowly as the year progresses."
Recent figures from Abbey Mortgages showed that over ten million consumers would fix their mortgage rate if they could.
