First-time Buyers Spending Up To 40% Of Pay On Mortgages
People buying a house for the first time are spending about 37% of their take-home pay on mortgage payments, according to the Nationwide.
The figure is well above the long-term average of 30%, the building society said, making it tougher for new buyers to afford a house.
House price growth picked up in the year to July as wages rose, it added. Prices increased by 2.1% over the year, the fastest pace since December 2022.
Some people were feeling more confident about getting a mortgage as their pay packets went up, Nationwide chief economist Robert Gardner said.
But relatively high mortgage rates and affordability issues also acted as a brake for prospective buyers.
The typical monthly mortgage payment remained "quite high", Mr Gardner said, especially compared with the 28% of their income first-time buyers were spending before the Covid pandemic.
It meant fewer people were able to afford properties, he said, especially as the amount of deposit needed was "high by historical standards".