CML: First-time buyer repayment affordability 'increasingly difficult'

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CML: First-time buyer repayment affordability 'increasingly difficult'

Tue 8th May 2007

Increasing numbers of first–time buyers are finding it more difficult than ever to meet repayment levels, new research has revealed.

The latest monthly mortgage survey from the Council of Mortgage Lenders (CML) indicates that first-time buyers spent an average of 18.3 per cent on mortgage interest payments in March 2007.

This was compared to 18 per cent during February and the 16 per cent from February 2006.

Income multiples for people investing in bricks and mortar for the first time also increased to 3.31 in March 2007, compared to 3.15 in the same month last year.

Michael Coogan, director general of the CML, said: "Mortgage lenders are trying to help by offering innovative products where appropriate but will want to ensure lending remains prudent."

The CML's figures also demonstrate that more first-time buyers are opting for the security of a fixed-rate mortgage, with 88 per cent of all such buyers buying into these mortgages.

Mr Coogan said: "With a rise in interest rates widely expected later this week it is encouraging that those first-time buyers who are getting a foot on the property ladder are opting for fixed-rate products."

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