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Sep 11, 2006
According to the
latest figures from the Woolwich Mortgage Affordability Research, the cost of
servicing mortgages across England
and Wales
jumped to £546, or 19 percent of household take-home pay, in August 2006.
Woolwich
says the increase in cost is the highest since it first started monitoring
affordability in 2002. In addition, this does not include increased costs due
to August’s base rate increase that Woolwich expects to filter through to
mortgage payments in September 2006.
The study attributes the increase to a
number of factors, including higher rates for fixed rate mortgages and a
buoyant property market in 2006, particularly in London where affordability
costs went up to a new high of 23.5 percent last month. All areas of the UK,
with the exception of the South-West (decrease of 0.2 percent) and the West
Midlands (no change), have seen affordability get worse in August with the
biggest rises in London, the North West and Wales which all saw increases of
0.4 percent over the month.
Woolwich
identified Holborn and St Pancras in London
as the least affordable place in the country with 31.2 percent of take home
household pay spent on mortgage payments. Camberwell and Peckham is second
(30.5 percent) and Hackney South and Shoreditch third (30.1 percent). Outside London, Oxford East is the
least affordable area with 26.2 percent of earnings spent on mortgages.
Staffordshire Moorlands remains the most affordable area to live in with 12.9
percent of earnings spent on repayments.
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