Mortgage payments are making up the biggest share of take-home pay for 17 years, according to figures released today.
The affordability gap has grown because property prices have risen three times faster than salaries in the past decade. Homeowners are spending a bigger proportion of their salary on the mortgage than at any time since the summer of 1990, according to a bleak assessment by the Royal Institution of Chartered Surveyors (RICS).
First-time buyers must spend almost five times more than they did a decade ago to get on the housing ladder, with poorer families having to save almost a year’s salary for stamp duty and a deposit.
The survey comes before tomorrow’s meeting of the Bank of England, which is expected to put a further rise in interest rates on hold. The Bank has already raised rates five times in the past year.
House prices and the great affordability gap