Mortgage repayments still consume more than half of household income despite falling rates, study finds
Sell House Fast found the average homeowner is spending 50.9% of their salary on mortgage repayments.
Homeowners are still spending more than half of their income on mortgage repayments despite recent reductions in mortgage rates, according to research from Sell House Fast.
The analysis found the average homeowner is spending 50.9% of their salary on mortgage repayments, even after average mortgage rates fell from 5.9% to 5.53% this week.
London accounted for nine of the 10 least affordable areas in the UK, with Kensington and Chelsea topping the list.
The average annual mortgage repayment in the borough stands at £70,595, equivalent to almost 172% of the average local salary of £41,078.
Elmbridge in Surrey was the only area outside London to feature in the top 10.
There, annual mortgage repayments average £38,248, representing more than 96% of the average local salary of £39,675.
The research also found affordability pressures extend beyond the capital, with Hertsmere, Windsor and Maidenhead, Epsom and Ewell, and Tandridge all recording mortgage repayments exceeding 80% of average earnings.
At the other end of the scale, Inverclyde in Scotland was identified as the UK’s most affordable area for homeowners.
Average annual mortgage repayments of £5,895 equate to around 20% of the typical local salary of £29,085.
Separately, a survey found more than half (54%) of respondents believe spending between 25% and 35% of their income on mortgage repayments represents the right balance, while 30% said housing costs should account for less than a quarter of their income.
Jack Malnick, managing director at Sell House Fast, said: “A mortgage should feel like a long-term investment, not a monthly source of stress.
“If your repayments are eating up more than 30% of your income, that’s often a sign you’re overextended.
“When essential expenses like food, bills, or savings start slipping, it’s time to reassess – whether that’s by switching to a better deal, adjusting your budget, or exploring a quicker sale if you’re really struggling.
“The key thing to remember is that there’s always a way through. Whether you’re looking to remortgage or sell up entirely, it’s important to take action early before the situation becomes overwhelming.”
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