BBC NEWS Americas Africa Europe Middle East South Asia Asia Pacific Arabic Spanish Russian Chinese Welsh
BBCi CATEGORIES   TV   RADIO   COMMUNICATE   WHERE I LIVE   INDEX    SEARCH 

BBC NEWS
 You are in: Business
Front Page 
World 
UK 
UK Politics 
Business 
Market Data 
Economy 
Companies 
E-Commerce 
Your Money 
Business Basics 
Sci/Tech 
Health 
Education 
Entertainment 
Talking Point 
In Depth 
AudioVideo 


Commonwealth Games 2002

BBC Sport

BBC Weather

SERVICES 
Thursday, 29 November, 2001, 18:23 GMT
UK houses affordable says bank
For sale signs
Affordability protects the housing market from recession
First time buyers spend a smaller proportion of their income on servicing their mortgage now than they did a decade ago, according to a leading UK mortgage lender.


The average first time UK buyer paid 14.1% of income on mortgage payments in the third quarter of 2001 compared with 15.6% in 2000 and almost 19% a decade ago

Barry Naisbitt
chief economist
Abbey National
Consequently, property is more affordable now than it was then, despite the last few years' surge in property prices, the bank Abbey National insisted.

Recent sharp falls in interest rates, along with rising incomes, have pushed down the percentage spent to service a mortgage.

"The average first time UK buyer paid 14.1% of income on mortgage payments in the third quarter of 2001 compared with 15.6% in 2000 and almost 19% a decade ago," said Abbey National chief economist Barry Naisbitt.

Interest rates to rise

Properties are expected to become less affordable because interest rates are set to bounce back over the next year, Abbey National said.

Though for the next three months, the bank predicted that rates would fall further and this should help boost the property market.

"For the housing market these indicators of affordability point to sturdy underpinnings for the year ahead which should help to protect the housing market from the worries about global recession," said Mr Naisbitt.

Regional variations

In the South East, the percentage has fallen to 14.9% from 20.1% a decade earlier.

East Anglia saw a fall to 13.5% from 19.3%, while Northern Ireland and Scotland saw only small changes in affordability.

See also:

27 Nov 01 | Business
UK mortgage lending bounces back
20 Nov 01 | Business
US attacks hit UK house prices
08 Nov 01 | Business
UK's summer property boom
05 Dec 01 | Business
UK house prices start to fall
01 Nov 01 | Business
House prices dip
08 Oct 01 | Business
Housing market spooked by attacks
03 Oct 01 | Business
UK housing market stalls
Internet links:


The BBC is not responsible for the content of external internet sites

Links to more Business stories are at the foot of the page.


E-mail this story to a friend

Links to more Business stories