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MONEYFACTS ARCHIVE. This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.


Lieke Braadbaart

Online Writer
Published: 16/04/2018

Today is Mortgage Freedom Day, the day on which the average Brit has earned enough to pay off the annual cost of their mortgage. Homeowners will be happy to hear that it has come three days earlier than last year, implying more affordable mortgage costs on average.

The day the celebration falls on is calculated by Halifax based on the average annual mortgage repayment cost, which this year is £8,039, and the average net annual income of £27,724 across the UK. It looks at how long this mortgage cost would take to pay off if all of one's income were to go towards it.

As the reality is that you pay off some of your mortgage every month while leaving the rest of your income for utilities, groceries and fun things, you'll still have to keep paying your mortgage after today. However, it's a good indication of how much you're really spending on your house.

It's particularly interesting when compared to Rent Freedom Day, as further data shows that renters will have to work 17 more days to pay off their annual costs. There are also stark regional differences, with a two-month gap between 10 March, when homeowners in Northern Ireland can celebrate their freedom, and 9 May, when those in England have reason to cheer.

Homeowners in London will have to wait the longest, as their day doesn't arrive until 13 June. Indeed, the only people who have longer to wait, when comparing regions, are renters in the capital, as their day falls on 18 July – which means that more than half their annual salary is going towards rent, on average.

Overall, Andy Bickers, mortgages director at Halifax, estimated that: "First-time buyers are saving £900 a year buying a home [rather] than renting." This sounds like a great reason to take that first step onto the property ladder.

Of course, nobody is exactly average. If you've managed to get a great mortgage deal and/or have a higher-than-average salary, your Mortgage Freedom Day may very well have come already. Indeed, you may want to calculate your yearly mortgage costs and count how many days per year you spend working to pay it off. If you've still got a while to go until your personal Mortgage Freedom celebration, that might be a good indication that you could benefit from remortgaging to a better deal.

What next?

Those looking to stop renting and start owning for the first time might benefit from a Help to Buy or Lifetime ISA

Current homeowners may want to look at the mortgage charts or contact their provider to see if they can find a better mortgage product


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