Mortgage repayments fell to their lowest level in 10 years in September 2011, research from Barclays revealed last week.
Analysis of over one million customer accounts showed that the average monthly mortgage payment hit its lowest level since 2001 in September, at 15.2% of take-home pay, or £488 a month.
For 2011 overall, payments accounted for 15.4% of take-home pay, the same level as in 2010 and compared with a high of 20.5% in 2008.
Barclays says it launched its cheapest deal in 15 years in July 2011 – a two-year fixed rate at 2.49%.
Andy Gray, head of mortgages at Barclays, says: “With the cheapest mortgage deals offered to home owners last year in a competitive market, it stands to reason that the average monthly mortgage payment was at its most affordable for a decade in September.”
David Hollingworth, mortgage specialist at London & Country, says 2011’s low rates were a consequence of improved competition and the fact that the base rate remained low.
He says: “There are still some good deals available but there are fears the situation in the eurozone will reverse that. We are already seeing some evidence of this with rates creeping upwards. “This analysis highlights that there are remortgage opportunities for borrowers, but those looking for a new deal might wish to move sooner rather
Barclays also commissioned an opinion poll which revealed that 64% of borrowers find their mortgage affordable at the moment, compared with 52% a year ago.
The survey also showed that 83% of respondents say they have room for manoeuvre should their circumstances or interest rates change, while just 40% of borrowers believe interest rates will rise in 2012, down from 74% in 2011.