Home owners in the UK have now earned sufficient, on average, to cover their mortgage payment for the rest of 2018 on what is known as Mortgage Freedom Day.
The calculations by lender the Halifax are based on the average annual mortgage repayment cost of £8,039 and the average net annual income of £27,724.
It reveals that there are wide variations across the country with a gap of two months between when home owners in Northern Ireland become mortgage free on 10 March compared to those in England on 09 May.
The research highlighted another divide across the regions, with those in the North, Yorkshire and Humber and the North West all reaching Mortgage Freedom Day in March, while Londoners have to wait until 13 June.
‘Despite only a small shift, borrowers this year have on average earned enough to meet their mortgage payments for the rest of the year three days earlier in 2017, a positive step considering a mortgage is often the greatest financial commitment we make in a lifetime,’ said Andy Bickers, Halifax mortgages director.
‘Home owners are overall better off than renters, with Rental Freedom Day falling more than two weeks later for the second year running. First time buyers in particular are saving £900 a year buying a home than renting,’ he pointed out.
‘The North-South divide remains when it comes to Mortgage Freedom Day, with home owners in the North reaching mortgage freedom up to three months earlier than their southern counterparts,’ he added.
At local authority district level, new borrowers in Copeland, in the North West, reached mortgage freedom first on 24 February 2018 and there is an even split this year between the North West and Scotland in those having the earliest Mortgage Freedom Day.
Following Copeland the next five are all in Scotland with Inverclyde and North Ayrshire on 27 February, West Dunbartonshire and Renfrewshire 01 March and East Ayrshire 02 March.
The remaining four local authority areas are Pendle, Burnley and Hyndburn, all 02 March and Barrow-in-Furness the 03 March.
Home owners in London and the South East have the longest to wait. In the London borough of Brent home owners don’t reach Mortgage Freedom until 11 August, preceded by those in Haringey 09 August and Harrow 30 July.
