First-time buyers underestimate mortgage costs
Many first-time buyers in the UK are underestimating how much it
will cost to repay their mortgage, according to a new study.
Research by conveyancing services provider My Home Move revealed
those stepping on to the property ladder expect to spend between
£100,000 and £150,000 on their first property, but they
are less clear on how much they will need for the repayment of the
Figures suggest a property costing £100,000 will require a
monthly mortgage repayment of £450 - which is 28 per cent
higher than first-time buyers expect. In many cases, potential
homeowners believe their mortgage commitment will be similar to
rental prices, but this is often not an accurate indicator.
"The majority of aspiring first-time buyers, 88 per cent, are
currently in rented accommodation, and as such their prime
comparison for a mortgage payment is the amount they pay in rent
each month," explained My Home Move’s spokesman Doug
He added: "According to industry figures the average rent outside
of London and the South East hovers around £600 a month,
suggesting that most aspiring first-time buyers want a like for
like swap in monthly outgoings, or even a saving."
Those wanting to step onto the property ladder are being encouraged
to fully research any purchases and ensure they are in a good
Last month, the average UK property price was £313,655,
exceeding the previous high of £310,471 set in June