Homeowners have typically earned enough cash by today to cover their mortgage payments for the whole of 2013, a report has found.
But people living in the rental sector will have to wait another month on average – until May 12 – before they find themselves in the same position, Halifax found.
Halifax pinpointed April 13 as “mortgage freedom day”, after working out that on the 103rd day of the year, people will have earned enough from their average annual take-home pay of £23,450 to cover their yearly mortgage repayment costs.
The calculation is based on yearly mortgage repayments costing £6,597 typically for a new borrower, including capital and interest payments. The figure is also based on typical house prices of around £161,400, as well as having paid a £50,000 deposit or having 30 per cent equity in their home.
Every penny of someone’s income for the year so far would have to be channelled towards mortgage payments in order for them to have mortgage freedom for the rest of 2013.
Meanwhile, someone living in the rental sector will have to earn another month’s pay until they have covered the average yearly rental payment of £8,892.
However, due to house price and wage variations across the UK, there are huge differences and down the country.
Mortgage freedom day in Northern Ireland was on March 16, whereas in Scotland it was on March 21 and in Wales it was last Tuesday (April 9).
Homeowners in England will have to wait until Tuesday this week (April 16) until they have earned enough cash.
Northern England and Scotland dominated the local authorities with the earliest mortgage freedom days.
Homeowners in four local authorities – Camden and Hammersmith and Fulham which are both in London, Cambridge and Mole Valley – will not have earned enough to pay their yearly mortgages until half of the year has passed. Homeowners in Camden will typically have the longest wait – until July 26.
Financial website Moneyfacts has pointed out that the typical fee for a new mortgage deal is now around £1,500, the highest on record – and rents have soared as people struggle to get on the housing ladder, with average house prices many times higher than average incomes.