You are here: Home - Uncategorized -

Wage earners becoming slaves to their mortgages

0
Written by:
30/05/2007

The rising cost of housing, and the tendency for mortgage lenders to advance ever-bigger homeloans, are factors turning many younger wage earners into little more than slaves, according to a report by a panel of academics.

The report warns that the soaring cost of property in the UK means that Britain is risking becoming “a grossly divided society”, as it was between the haves and the have-nots in Victorian times.

The report, entitled ‘On the Treadmill’, says large mortgage loans are forcing increasing numbers of young parents to work longer hours, with many taking on second jobs to pay a mortgage which could be up to seven times’ their salary.

The report’s findings have been unveiled at a time when the British Bankers’ Association reported that the average mortgage is now a record-breaking £152,800, compared to £50,000 in 1994.

A borrower with a £150,000 mortgage would be making repayments of around £1,100, or 75% of their take-home pay for an employee earning the average salary.

The report, compiled by academics from the universities of Aberdeen and Loughborough, says that many young couples are little better than “bonded labourers” to their mortgages.

Dr John Bone, lecturer in sociology at Aberdeen, said: “They are like bonded labourers because they are so heavily indebted. The burden of their mortgage debt will place great stress on their families.”

Tagged:

Tag Box

Debt

Pension

Spending

Financial fitness

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

Are you a first-time buyer looking for a mortgage?

Look no further, get the help you need by searching for your perfect mortgage

Which ISA is right for you? A round up of the six products available in 2017

From cash to innovative finance to lifetime, here's our guide to the ISA products available to savers this yea...

Guide to buy-to-let tax changes

In late 2015, former Chancellor George Osborne announced a range of  tax measures aimed at landlords, which t...

A guide to switching energy provider

All you need to know about switching from one energy supplier to another.

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

Five fund tips for a 0.25% interest rate environment

With interest rates stuck at a record low 0.25% and expectations rates could fall to close to zero, here are ...

Protecting family wealth: 10 tips for cutting inheritance tax

Inheritance tax - sometimes known as 'death tax' - can cause even more heartache for bereaved families. But th...

Travel insurance: Five tips to ensure a successful claim

Ahead of your summer holiday, it’s important to make sure you have the right level of travel cover or you co...

Investing your money

Alliance Trust Plc gives you smart insight into how to invest your money

Money Tips of the Week

Read previous post:
Premium Bonds break the big £6.6bn barrier

With five jackpot prizes of £1m up for grabs in their 50th birthday celebrations, sales of Premium Bonds over the past...

Close