Mortgages now ‘more affordable’

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Scotland has the second most affordable mortgages in the UK, according to a study which reported “significant improvement” in affordability.

Mortgage payments account for 22 per cent of disposable income for people in Scotland, down from 38 per cent five years ago. It is beaten only by Northern Ireland, where 20 per cent of disposable income goes towards mortgage payments.

The UK average is 28 per cent and in London the proportion is 36 per cent, research by the Bank of Scotland found.

The mortgage affordability position was mainly due to a fall in house prices.

The bank’s study compared the final quarter of 2007 with the final quarter of last year and found that mortgage payments as a proportion of income have fallen by more than two-fifths, from 38 to 22 per cent.