First-time buyers spend 36% of pay on mortgages

Recent reports indicate that home purchasing has become slightly more affordable for first-time buyers due to earnings growth and lower interest rates, although affordability remains stretched. A typical first-time buyer now spends 36% of their monthly income on mortgage payments, which is still above the long-run average of 30%, as average house prices have risen to £292,000. Proposed reforms to mortgage rules could potentially allow an additional 76,000 first-time buyers to secure larger loans, but experts warn this may lead to increased home repossessions and inflated housing prices. Meanwhile, the housing market continues to pose significant challenges, particularly in high-demand areas like London, where affordability issues persist. Additionally, industry experts emphasize the importance of building a substantial deposit to make homeownership feasible. Overall, while there are indications of improved affordability, many prospective buyers still face substantial barriers to entering the market.