The latest research conducted by high street building society Nationwide has revealed that if you are looking to purchase your first property in London, you should expect to purchase at a minimum of nine times your annual earnings.
The report, which has been conducting this calculation since 1983, showed that when looking at income multiples, London house prices are at their highest ever. Further, whilst it shows some stabilisation, it has continued increasing over the years since the early ‘90s, when it was not even three times the local income.
With mortgage rates still sitting at an all-time low, first-time buyers are not in fact stretched any more financially. Currently, mortgage payments represent around 34% of people’s after-tax pay, and experts have predicted further growth this year with rates looking to remain low and people’s confidence high. Q4 2014 saw a 1.1% increase and Howard Archer of HIS Insight commented:
“The Bank of England looks unlikely to raise interest rates before late 2015.”
These reports would indicate that mortgage professionals could continue to be busy, as borrowers review existing rates and seek advice on saving money, as well as first-time buyers looking to get onto the property ladder. Once you have undertaken your CeMAP training and become accredited after passing the end exam, your advice and support forms a vital part in a customer’s borrowing journey – whether they are buying a new property or reviewing existing lending that they hold.