Battersea mortgage debt 1,000 times higher than Skye
The Battersea and Clapham Junction area of south-west London - or postal area SW11 6 - is sitting on home loans that together add up to a whopping £649 million, according to the Council of Mortgage Lenders (CML).
This postal area’s outstanding mortgage debt is 1,191 times more than the area with the least amount left to pay off, the research shows.
The Isle of Skye has outstanding mortgage debt of just £545,115 - the price many three-bedroom flats in Battersea go for, according to property website Rightmove.co.uk.
In fact, all 10 postal areas with the most residential mortgage debt can be found in London. Battersea, Docklands, Wimbledon, Balham, Tooting and Maida Vale all feature in the list.
At the other end of the mortgage debt spectrum, the postal areas with the least amount of mortgage debt include the Isle of Islay as well as Argyllshire and Renfrewshire in Scotland, Stockport, parts of Liverpool and Huddersfield. One London postal area also made the list - the surrounding areas of Edgware Road, or NW9 1 as it’s officially recognised.
While the figures provide a snapshot of the UK mortgage market (based on lending data from Barclays, HSBC, Lloyds Banking Group, Nationwide Building Society, Santander UK, RBS, and Clydesdale and Yorkshire Bank, who make up about three quarters of the total market), the CML points out that the figures clearly reflect the populations, house prices and type of property available in each postal area.
For example, the London borough of Wandsworth – home to Battersea – had a population of nearly 307,000 in 2011, according to the latest census, while average house prices in London stood at £437,000 in October, according to the Office for National Statistics.
By comparison, the Isle of Skye has a population of around 10,000 and a three-bedroom semi detached home can be bought for just £120,000, according to Rightmove.co.uk.
CML director general Paul Smee said: "As you would expect, strong levels of mortgage lending are broadly correlated with those areas where there is a strong resident population.”
In a briefing, the CML added: “Borrowing is not a direct indication of the financial health of borrowers. Levels will reflect the demographic and characteristic makeup of a sector and its customers – for example, predominantly residential sectors will be unlikely to see high levels of SME borrowing, predominantly shopping areas will be unlikely to see high levels of mortgages or personal loans.”
This is a mutual organisation owned by its members and not by shareholders. These societies offer a range of financial services but have historically concentrated on taking deposits from savers and lending the money to borrowers as mortgages, hence the name. In the mid-1990s many societies “demutualised” and became banks. One academic study (Heffernan, 2003) found demutualised societies’ pricing on deposits and mortgages was more favourable to shareholders than to customers, with the remaining mutual building societies offering consistently better rates. In 1900, there were 2,286 building societies in the UK; in 2011, there are just 51.