Housebuilder Sees Rise In 36-Year Mortgages
The McPherson Development in Gourock
Customers at one of the UK's biggest housebuilders are taking out longer mortgages to make monthly repayments more affordable.
Taylor Wimpey said 27% of first-time buyers are taking mortgages of more than 36 years compared to 7% in 2021.
While extending mortgage terms means lower monthly payments, customers can end up paying more overall.
Mortgage rates have been soaring as the Bank of England raises interest rates to try to get inflation under control.
The housebuilder said that alongside first-time buyers, second-time buyers are also increasing mortgage terms, with 42% taking mortgages of more than 30 years, compared with 28% in 2021.
The latest figures from the bank industry body UK Finance also show an increase over time in long-term mortgages.
In March this year, 19% of first-time buyer mortgages were for more than 35 years, up from 9% in March 2022.
For people moving house, 8% were longer than 35 years, compared with 4% the previous year.
As mortgage rates have risen, the number of house sales has been on a downward path.
In the UK as a whole, the number of housing transactions was higher in June compared with May, but it was 9% lower than in June 2022, according to HMRC statistics.