An analysis was made on the current cost of repaying a mortgage across each area of the British property market, before comparing this to the average annual gross earnings of a household in each area based on two incomes per household, to see just how much of our income a mortgage now requires, as well as how this cost has changed since the start of the year.
With the average Brit earning £2,635 per month, the average British household benefitting from two incomes is taking home a gross monthly income of £5,270. Based on borrowing at the latest mortgage rates and with a 75% loan-to-value mortgage on the current average house price of £295,747, the average household is paying £1,139 per month when repaying their mortgage.
This accounts for 22% of a household’s gross monthly income, which is up from 16% in January this year. London is predictably the least affordable region and the average household across the capital is currently spending 30% of their gross monthly income to cover their monthly mortgage repayments, followed by the South West (27%) and South East (26%), according to the report.