The number of people taking out risky mortgages jumped by 15 per cent last year, with Croydon becoming the UK’s number one hotspot for high-risk mortgage lending.
Banks approved 101,380 mortgages in 2017, and the south London town of Croydon had 463 high-risk mortgages taken out, rising 11 per cent on the year before despite the UK average being just 39 risky mortgages per area.
According to Bank of England guidance, mortgages are considered “high-risk” if they are lent at 4.5 times or more of the applicant’s salary.
Along with Croydown there were a number of London areas with a high volume of risky mortgages, with Walthamstow (421), Wandsworth (363) and Streatham (322) all following close behind.
|Top 10 areas for risky mortgages in the UK|
|1. Croydon – 463
2. Walthamstow – 421
3. Wandsworth – 363
4. Streatham – 322
5. Tooting – 319
6. Brighton – 313
7. Hove – 296
8. Battersea – 296
9. Farnborough – 294
10. Wimbledon – 276
The number of high-risk mortgages in Croydon “reflects the turnaround in its reputation”, according to peer-to-peer lending platform Lendy, which carried out the findings.
With the recently-opened Croydon’s Boxpark and the upcoming Westfield Shopping Centre due to begin construction in a year’s time, Croydon has undergone significant redevelopment and gentrification.
Liam Brooke, chief executive of Lendy, said: “More and more people are stretching their budgets to live in Croydon. Unexpectedly it has become one of the country’s property hotspots.”
Source: City A.M.