Monthly mortgage payments in October were the most affordable for nearly eight years, but lending numbers dropped.
Council of Mortgage Lenders data shows that, although first-time buyers’ deposit requirements have remained stable in recent months at an average of 20%, their monthly interest payments have continued to fall and now typically consume 12.3% of income, the lowest level since January 2004.
Affordability for movers also improved, with this group paying an average of 9.2% of income on mortgage interest, the lowest level since monthly records began in 2002.
However, despite the improved affordability of monthly mortgage payments, lending activity slowed.
In October, 44,500 loans for house purchase were advanced, down from 48,200 in September and from 46,900 in October 2010.
Of the 44,500 loans, 16,400 went to first-time buyers, down from 18,200 in September, and down 1% on October last year.
Charles Haresnape, managing director of Aldermore Mortgages, said of the statistics: “Affordability is one thing, but the lack of deposits remains a major factor in holding back the housing market, especially for first-time buyers.”
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Comments
Indeed I'll make the most of it :o)
And yes many students do study what seem to be completely useless subjects the education system needs rebalancing.....IMHO more young people need to learn trades and skills that cannot be replaced by robots and computers.....damn is that 2 things we agree on?
Happy Chappy: You did indeed mistakenly assume that the comment was directed specifically at your goodself
I was actually confirming your statement (doesn't happen often - make the most of it... ;o) ) that it is not possible to pidgeonhole FTBs as being typically early 20s any more - and therefore impossible to follow a standard path of argument. The sentence following the one you latched on to, when read in conjunction, I feel made it a bit clearer... but maybe not!
I am sorry that you picked it up as disagreement or me simply lookin' for a barney!
THAT came much later - see the anti-student bit! ;o)
Peebee If I mistook this comment "ALL argument is like widdling in the wind - some of it will come right back at you so why bother" I thought that was aimed at me which confused me as i thought we were broadly agreeing!!
Happy Chappy: Funny - I've looked through MY post as well, and fail to spot the following -
I do not see where I am stirring an argument. I actually AGREED with you - which is the most bizarre way i have ever heard of to kick off a ruck...
I did NOT say that all the talk about 'averages' was down to you. It is, however, used TWICE in the main stroyline to which we are debating; and a further four times in the various comments (including twice by myself to which I take it you are referring to and assuming that I was targeting you - which you will realise is inaccurate if you read again...)
I am not disagreeing with you that propertyy is inaffordable for a large proportion of people. Indeed, if I were starting out on the homeowning trail myself I would struggle to buy anything remotely resembling the home I currently live in - and it is far from a mansionette!
I feel for the youth of today just as much as you do - having a brace of them myself in just this situation I feel it daily - and would give ANYTHING to resolve their situations.
As far as giving advice to school-leavers goes - I've done my share with my own. I simply told them to do what makes them happy, and they would receive my full support and admiration.
And they have received just that.
It seems to slip everyones attention, but society needs EVERY job filled - regarless of how lowly that job may appear to some. There is as much need for street-sweepers as there is cardiothoracic surgeons - more need, if you are simply talking in numbers... and if someone can have a self-fulfilling career sweeping streets then I take my hat off to him or her.
One day I might just bore you all to death with a VERY relevant story along those lines - but not tonight...
Still very much in the honeymoon phase thanks mate.
I think you are looking for an argument that isnt there....i am but happy to slug it out with ya if ya want.
I dont recall using the word average....quick check...nope i didnt. I was however saying that affordability is often an issue and for many differnt reasons...or do you believe property is affordable for everyone?
As for them students hmnnn what advice would you give a school leaver these days? What should they study that will ensure they have job that will in turn ensure they are happy and can all afford be on the property ladder......Let me know i'll tell my daughter...Cheers!
Happy Chappy: You don't seem so happy these days - but being all newlywed and such you should be on top of your world... Hope you haven't found out that Mrs Chappy doesn't make Yorkshire puddings like your Mam does/did - or that she has accused you of the same failing!
ANYWAYS... you say "Defining a FTB'er is difficult these days and will continue to be long in to the future...."
Correct. Therefore ALL argument is like widdling in the wind - some of it will come right back at you so why bother!
All this talk about "average this..."; "average that..." means diddly squat in the real world - yet the debate rages on.
I remember a case of an old lady here 'Oop North' (who I am certain was in her 80s) who bought her council house on a RTB with a Northern Rock mortgage a decade or so ago. She had been a council tenant all her life, brought up her kids in the same property - and then decided that it was daft to pay rent! The story made the nationals.
You then say "...often with debt not always caused by reckless spending (student loans perhaps)". Mate - the student loans of today may well be seen as the 'reckless spending' of tomorrow. There are no jobs available for these "Sports Science 2.1 grads" in their chosen, totally worthless, fields of 'educational expertise'. They are the ones I have seen CVs for telling me that they have always have an interest in property and wish to make a career in it; the very same people also have always had an interest in bus driving, veterinarian nursing and burger flipping, dependent on the name of the recipient no doubt.
Of course, that is just the view of a comprehensive school lout who failed his Maths GCE - but only because I WANTED to... ;o)
Anna - a quick question.... have you ever felt you have been overcharged for something. Did you complain? If so why?
Peebee - Defining a FTB'er is difficult these days and will continue to be long in to the future....Many will be much older than the stereotype, perhaps with kids (not always living permanently with them).....often with debt not always caused by reckless spending (student loans perhaps). A one bedroom flat is often completely unsuitable....and therefore what they need (not want) is unaffordable
"Tell him to get his deposit down quick" there is another problem....but i think you get the picture...hope this relates to the article
Agreed though for many young individuals who want to live in Anna's England for the rest of there lives, the answer is :
Leave school get a job (any job if there is one) , use the BOMAD perhaps, save like hell to buy buy a starter home to live in and hope the housing boom continues.
Or
Leave school get pregant, get maintenance (hopefully) get various benefits including a home paid for by someone else because housing is unnaffordable.
Puzzled...: "Around here anything made from bricks is going to involve a FTB in a 200k mortgage."
Erm... assuming you mean Tunbridge Wells, a quick look on RM shows there to be quite a variety of one bedroom flats to be had at prices starting around £80k; and, assuming your son is under 55, he can grab a two bedder for as little as £130k.
Tell him to get his deposit down quick - chances are these properties won't hang around waiting for him...
@PoTW
I totally agree - I do hope for the day that the 99% (which includes EAs) wake up from their stupor and realise what's really going on.
Long as the tented ones don't want anything from the State that they see as so unfair and opporessive, no problem.
But the point about disliking capitalism yet taking advantage of it strikes me in this debate that has developed (and was not what the article was about!!). I think saying the tented ones should not enjoy the occasional Starbusk's is a bit too strong (like the coffee). But to be using laptops, and the web to make points.
That's a bit strong too isn't it.
I assume PotW that whilst you think those of us that graft far harder than you evidently feel you or we should, are nevertheless glad that we midnless ones do so in order to support those who'd rather not follow such a slavish routine - and pay taxes to generate benefits?
@ PoTw- please feel free to leave our country as soon as you like, this is England not some communist state.
Anna: "Get a tent in St Pauls, job done. No rent no mortgage no debate! Idiots, but no debate."
How does one define an idiot? Hmmm. Someone who observes that the society they live in is grossly unfair and that the vast majority of the wealth is in the hands of a tiny minority. And protests about it? Protests about the exploitation of millions of people by a small group of people (the bankers).
The majority of the majority (as it were) live their lives like sheep - up in the morning, 'work for the man' all day, pay their bills, live for the couple of weeks off each year - touch their forelocks and count themselves lucky they don't live in the third world.
A few people awake from their stupor and protest about the way our society and economy is structured for the benefit of the minority and they are, apparently, idiots.
Idiots like the few people who complained about their working conditions and were transported to Australia for their trouble. Ironic that 180 years later, millions of people daydream about escaping to Australia for 'a better life'. Idiots too, no doubt. Still those few people caused the birth of the trade union movement which, like it or not, transformed the lives of millions for the better.
Who knows where the current protests might lead. You never know - the current young generation might suddenly wake up from their torpor and realise the extent to which they are being shafted. No, that would be just too idiotic.
That's rather ironic Anna given your contribution to this site is less-than-zero.
Get a tent in St Pauls, job done. No rent no mortgage no debate! Idiots, but no debate.
Cheap mortgages do not cheap housing make.
@Puzzled
You make a good and valid point though of course higher priced areas would probably skew the figures and make extreme examples even allowing for a higher average salary in that area. Reverse with lower priced areas an earnings.
But the point is well made.
When I was at NBS the formula for lending was
One week's net income to pay the mortgage
One week's net income to pay all other housing related bills (which are considerable and extensive when you list them out to include repairs and maintenance etc)
One week's net income for that good old fashioned word, housekeeping
One week's net income for all other matters including running a car, saving and holidays(!!)
The old "one in four" formula and i was used industry wide.
We always used to advise the mortgage itself was the easy part long as you'd borrowed on sensible multiples and interest rates weren't above average. And we used to advise (and work out for applicants) what their payment would be if interest rates were 3% higher especially if they were borrowing when they were below average.
Seemed to work - I'd be very surprised if any recent first time buyer is able to get away with less than 25% net income for the mortgage and all housing related bills. Probably more like 30% even at these low interest rates and 40% if they are anywhere near x5 income as a multiple.
Wow, typical first time mortgage only consumes 12% of income? What's the problem? Surely house prices should be twice as high as they are now.
Around here anything made from bricks is going to involve a FTB in a 200k mortgage. Which - at about 5% interest will cost them 10k a year of taxed income.
Let's say a FTB the average salary - let's pretend it is 30k and they take home about 23k. No, it's no good, figures were never my strong point. 12% eh - terrific - must let my eldest son know that it's okay, he can buy a flat and he only needs to budget for 12% of his take home pay on paying the mortgage. Terrific - that's way less than when I was his age.