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Blackburn residents ‘closest to paying off mortgage’

Amanda Jarvis

May 15, 2006

The RBS fastest mortgage league outlines the UK’s mortgage repayment hotspots, where the average homeowner is closest to completing the final payment on their property. Blackburn tops the table, as the average local homeowner wage of £18,356 and property price of £89,982, means that the average resident has just eight years and two months of repayment remaining.

Blackburn is closely followed by Halifax, West Yorkshire, where the average resident will take just two months longer to pay off their mortgages completely. Kilmarnock, in Scotland, is third in the league with an average remaining repayment term of just eight years and ten months.

The RBS fastest mortgage league has been compiled using the average price of properties combined with the average homeowner income in each area. Those figures are then used to determine the number of mortgage repayments necessary to pay off the mortgage on an average property, based on the fact that the average UK homeowner spends around 18.5 per cent of their income on mortgage repayment. The result enables the league to identify the top two towns in each region of the UK where residents could be free of mortgage repayments the soonest.

The Premier League of Mortgage Repayment
The top towns in each UK region where average earners can pay off their mortgages in the least amount of time.

1 – Blackburn
8 years, 2 months
 
2 – Halifax
8 years, 4 months

3 – Kilmarnock
8 years, 10 months

4= – Falkirk
9 years, 4 months

4= – Teesside
9 years, 4 months
 
6 – Kingston upon Hull
9 years, 5 months

7 – Manchester
9 years, 7 months

8 – Sunderland
10 years, 11months

9 – Newport
12 years, 2 months

10 – Stoke-on-Trent
12 years, 3 months

The national picture reveals a heavy bias towards the north of England where property prices are significantly lower than the south, while earnings remain comparatively high.

However, the picture is more complex than a simple north/south divide, as the RBS fastest mortgage league reveals notable differences in the number of remaining repayment years between neighbouring towns. For example, while residents in Blackburn can potentially pay off their mortgages in less than nine years time, people living just a few miles away in Preston will wait nearly twice as long (almost 18 years).

Regional rivalries

Contrary to their football scores, Newcastle is not on top when it comes to mortgage repayments compared to rival Sunderland. Residents in Newcastle will take an average of 14 years, whereas those residing in Sunderland will take an average of only ten years and 11 months to become mortgage free.

Despite being separated by one hour’s drive, Glasgow (10 years, 3 months) and Edinburgh (18 years, 1 month) differ by nearly eight years in potential repayment terms. One of the widest regional differences lies between Wolverhampton and Worcester, where a mere 60 kilometres equates to more than a ten year difference in remaining mortgage repayment.

My home is my castle

Research among a sample of Britain’s ten million mortgage holders reveals a strong desire to own one’s home outright. Almost nine in ten mortgage holders (88 per cent) say they want to pay off their mortgage as soon as possible. Among 18-34 year old mortgagees, almost one quarter (22 per cent) believe they will be able to pay off their mortgage by the time they’re 40.

Karen Snodgrass, head of RBS Offset Mortgage, commented: “Our research shows a strong desire among homeowners to make their homes truly their own and pay off their mortgages as soon as possible. Our fastest mortgage league highlights areas across the UK where anyone aiming to pay off their mortgage quickly, can make this dream a reality.

“Even if consumers do not live in these areas, there is much they can do to become mortgage free quickly. An RBS Offset Mortgage allows you to offset the interest you pay on your mortgage against your current and savings accounts. It can help the average homeowner pay off their mortgage around two and a half years ahead of schedule. This flexible approach can also save customers thousands of pounds so that they can become fully financially secure even more quickly.”

RBS Offset’s research suggests that this trend towards outright ownership is being fuelled by an inherent craving for security. Some 44 per cent of mortgage holders describe paying off their mortgage as the single-biggest thing they could do to safeguard their security in later life – that’s almost twice as important to them as building up a pension or a savings nest egg.

Almost three-quarters of outright homeowners (72 per cent) agree that paying off their mortgage was the single-most important thing they’ve ever done to ensure their sense of contentment and security. The study confirms the knock-on effect of this, with statistics showing that, while almost a third of outright owners (31 per cent) feel extremely financially secure, less than one in six of current mortgagees (14 per cent) feel this way.


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