New analysis of housing debt shows how different mortgage constraints affect different areas of Britain.
While northern England and Wales have higher average outstanding loan-to-value mortgages, London and the South East have the highest average loan-to-income ratios. But, the markets exposed to both are most at risk when rates rise.
Loan-to-value mortgages
On average, British mortgaged owner occupiers have an outstanding loan-to-value of 48 per cent, ranging from 39 per cent in London to 60 per cent in the north east of England, despite the fact that the total value of mortgage debt in London is more than six times higher.
Owner occupiers in London have benefited from strong price growth post-credit crunch, which has added substantially to their net housing wealth. In contrast, residential property in the North East carries a much higher level of debt relative to the underlying value of the assets on which it is secured, due to lower longer term price growth and a much more muted performance over the last 10 years.
This variation is even more pronounced at a local level: in Burnley the average outstanding loan to value among owner occupiers with a mortgage is 88 per cent, while in Camden it is just 15 per cent.
Interactive map showing average loan-to-value ratios across the country: