First time buyers face record debts

First time buyers now face greater mortgage debts than at any time since records began, new Council of Mortgage Lenders (CML) figures have shown.

New home owners can now look forward to an average mortgage of £106,400 when they take their first step on the property ladder, almost £12,000 up on the same time last year.

Annual salaries are now less than a third of the average mortgage – the widest income gap since figures were first gathered more than 30 years ago.

The CML warned that mortgage costs are now putting pressure on previous older homeowners, with the average mortgage now worth £123,350 another record figure.

"Consumers have been bingeing on cheap credit for several years," Simon Tyler of Chase de Vere Mortgage Management told the Daily Mail.

"But now they are being forced to think about how they will cope if rates rise."

While first time buyers and others are still able to bridge the gap due to the low cost of borrowing, rising interest rates could be bad news for many, said the CML.

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