Money Wellness
Illustration of person calculating mortgage on giant calculator
category iconmanaging your money
calendar icon24 Jun 2024

Average first-time buyers’ monthly mortgage payment tops £1,000. Find out what to do if you’re struggling with your mortgage payments

Soaring house prices and high interest rates are forcing first-time buyers to pay upwards of £1,000 a month for their mortgage.

That’s a 61% rice since the last general election in 2019.

Property website Rightmove found that the average payment for a first-time buyer is now £1,075 a month, up from £667 in 2019.

The combination of rising house prices and high interest rates has put increasing financial pressure on people trying to get onto the housing ladder.

Rightmove have said they’re seeing more first-time buyers extend their mortgage terms to 30-35 years to lower their monthly payments.

On top of this, many younger borrowers have been forced to look for smaller properties so they can secure cheaper mortgages.

This comes after the Bank of England held interest rates at 5.25% last week for the seventh time in a row. This means the cost of borrowing is likely to stay high for the foreseeable.

A first-time-buyer home in Great Britain now costs an average of £227,757, a 19% rise since 2019. In the last five years, the north-west has seen the biggest increase (33%) in first-time buyer prices, while London’s prices predictably remain the highest.

Millions of homeowners have also been forced to remortgage at much higher interest rates in the past 18 months.

Struggling to pay your mortgage?

Your lender has a responsibility to help if you’re struggling with money.

It’s important to know your rights: the mortgage charter lets you extend your mortgage term to six months, or switch to interest-only payments. This won’t affect your credit score, nor does it involve affordability checks.

If you’re in arrears, the government may be able to help you cover some of your interest payments - support for mortgage interest (SMI) is a loan that you’ll need to repay with interest when you sell your home or transfer ownership. To be eligible for SMI, you need to be getting a qualifying benefit.

Are you in debt?

If you’re finding it hard to keep up with your debts, we may be able to help.

We offer free debt advice online, or you can give us a ring. Whether you need advice on debt solutions, what benefits you might be able to get or help with budgeting, we’re here for you.

All our advice is free and impartial. Some debt solutions are free, while others have a fee.

Connie Enzler

Connie is a multimedia money-wellness-in-work expert, with a master's in multimedia journalism and over five years' experience as a digital writer and podcast creator. Connie is committed to making debt and personal finance information accessible to all.

Related posts

Debt warning ahead of Amazon Prime Day

We’re warning shoppers to be cautious about overspending on Amazon Prime offers, after witnessing a rise in unsecured debt over the past 12 months.

Parents could face fines of up to £2,500 from next month for taking their kids out of school to go on holiday

Punishments for unauthorised absence from school are set to get much stricter - and expensive - from next month

Act of saving money can ‘boost wellbeing’

But what if you can’t save even the smallest amount?