Examines different housing affordability indicators covering both access to and the sustainability of home ownership to provide an overview of current housing market trends. Considers the background of house price growth and the worsening of housing affordability since the 1980s according to the Barker Review. Looks at how deposit constraints are preventing first-time buyers entering the market and how households are being denied access because of low incomes. Considers the sustainability aspect of affordability in terms of homeowners ability to service debt and discusses debt erosion in respect of established mortgage holders. Concludes that affordability will worsen and will be the primary driver in the market slowdown. Charts cover long run house price growth, first-time buyer ability to pay, house price to earnings and disposable income ratios, initial mortgage payments, regional affordability and inflation rate impacts on debt and earnings. References.
HOME OWNERSHIP DEBT SERVICING DEBT EROSION INTEREST RATES DISPOSABLE INCOME HOUSING SUPPLY BARKER REVIEW OF HOUSING SUPPLY: SECURING OUR FUTURE HOUSING NEEDS AFFORDABILITY Affordable housing HOUSE PRICE INFLATION FIRST-TIME BUYERS INFLATION RATE MORTGAGE PAYMENTS