Third of London mortgage holders will struggle to meet payments over next six months
More than a third of London homeowners paying a mortgage believe they will find it hard to keep up with payments in the next six months, a poll has found.
A poll by YouGov for City Hall found that the 34% of respondents said they would struggle to maintain payments. This was up from 21%who said the same at the start of this year.
Looking at data from the Institute for Fiscal Studies, City Hall has estimated that 209,000 households in London would be hit by higher mortgage rates, adding an extra £520 per month to their bills.
Mayor of London Sadiq Khan has called on the Government to bring back mortgage payment holidays, reverse cuts to support mortgage interest through the social security system and allow owners to switch their tenure to affordable rented or shared equity.
Khan: ‘Wave of repossessions’
The mayor said this could help prevent a “wave of repossessions”.
Khan said: “Many London homeowners already face sizable monthly mortgage payments alongside rising costs and put simply, they are struggling to cope. Hundreds of thousands more London households will see their mortgages skyrocket this year and next, with those on lower incomes at greatest risk of defaulting on their mortgage payments, getting into debt, or losing their homes.
“The Government have so far failed to recognise the scale of the crisis – I’m calling on ministers to take urgent steps to protect London’s homeowners from the devastating impacts of high mortgage rates.”
Paula Higgins, CEO of HomeOwners Alliance, added: “What is clear is that many households have been worried or are just about coping with soaring mortgage costs, and may have reached the tipping point. Especially for Londoners who already have to deal with high house prices that are no way in line with average wages. And especially for those who have been battered with the relentless cost of living increases.
“Homeowners worried about covering their mortgage costs must not think that they are alone. Their first port of call should be to speak to their lender about options, such as extending the mortgage term to reduce monthly payments, reducing what you pay for a short period, mortgage holidays or changing temporarily to interest-only payments. And for those who are coming off of lower fixed term mortgages, they must not bury their head in the sand. Higher rates will likely stay with us for the foreseeable future. If your current mortgage deal ends in the next six months, then start looking at your remortgage options now.”