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Mortgage debt 'doubles in decade'

17/09/2007

The average mortgage debts of young homeowners in Britain have reportedly almost doubled over the last decade.

New analysis shows that in 2005 the average mortgage debt held by a UK resident aged between 25 and 34 was £96,000, compared to £50,000 ten years previously.

The claim is made in a new joint wealth report from the National Centre for Social Research (NatCen) and the International Longevity Centre.

According to the social research group and thinktank's findings, the majority of UK households are now considerably better off compared to their 1995 counterparts.

The bulk of this wealth can largely be attributed to rising house prices over the same period, the report's authors write, although they claim that many people are in a worse financial situation on a day-to-day basis.

While the average value of a property owned by people aged between 25 and 34 was shown to have almost tripled to £167,000 since 1995, personal debt levels have rise in line with mortgage debts.

The report shows that whereas in 1995 the average personal debt among young Britons stood at £2,400, by 2005 it had risen to £4,600.

And in addition, 25 to 34 year olds are contributing significantly less to their pensions than ten years ago, with contribution rates sliding from 26 per cent to 13 per cent between 1995 and 2005.