The average monthly mortgage payments for first-time buyers putting down a 10 per cent deposit have climbed past £1,000 for the first time, according to property site Rightmove today.
The latest interest rates rise of 0.5 per cent has piled further pressure onto new buyers’ affordability, as property costs outpace annual wage packets.
“It’s likely that the impact of interest rate rises will gradually filter through during the rest of the year, but right now the data shows that they are not having a significant impact on the number of people wanting to move,” director of property science Tim Bannister said.
House prices traditionally fall in August, as summer holidays take the front seat on movers’ agendas.
However, the average cost of a home still sits at £365,173, having slipped 1.3 per cent this month – the equivalent of £4,795.
Asking prices have more than doubled from £155,994 to £365,173 in the space of two decades, when Rightmove first began its House Price Index.
Director of London estate agents Benham and Reeves, Marc von Grundherr, added that rising costs will leave the housing market no choice but to cool.
“The increasing cost of both buying and borrowing has started to dampen the insatiable appetite of the nation’s buyers ever so slightly,” he said. “When coupled with the fact that the drought of new homes entering the market is now starting to ease, a marginal reduction in asking prices was always going to materialise.”