Future Of British Business
Paying a Mortgage in Britain Is No Longer Cheaper Than Renting
- Mortgage payments to eat up 40% of income, UBS analysts say
- Homebuilder stocks may be attractive after 50% drop this year
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House prices in the UK look set to slide next year as the cost of paying a mortgage is no longer cheaper than renting, according to UBS Group AG.
Mortgage repayments as a proportion of income have increased to more than 40% after hikes to interest rates, analysts Gregor Kuglitsch and Marcus Cole wrote in a note Monday. That’s a “key pinch point” that will result in house prices dropping by 10% next year, they say.