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Lenders split on North/South divide

The North/South divide is either widening or narrowing depending on conflicting figures from two of the UK&#39s biggest lenders.

Cheltenham & Gloucester says the gap is widening but Bradford & Bingley believes it is closing. C&G&#39s affordability index for the final quarter of last year shows house prices in the South running away from the Northern regions as well as the East Midlands, Scotland and Wales on affordability.

Its index determines affordability by comparing the amount of money needed for a typical mortgage per £100 of average take-home pay.

The average housebuyer in the more accessible regions of the North and East spends 23.8 per cent of their take-home pay on their mortgage.

By contrast, borrowers in London and the South-east are spending 39.6 per cent and 38.6 per cent of take-home on their mortgages respectively.

C&G managing director Roger Burden says: “These figures show the typical homebuyer in the North gets more home for his money and pays a much smaller proportion of his income on his mortgage than the typical home- buyer in the South, leaving more disposable income.”

B&B says house sales figures show a narrowing North/ South divide. It says properties in the North are selling two weeks faster in June than in February whereas in the South-east the time has stayed constant at eight weeks.

B&B Estate Agents chief operating officer Jim Jamison says: “While prices might have dropped as a result of buyers becoming more discerning about the price they are prepared to pay for a property, our research indicates realistically priced homes are still selling quickly.”

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