More people struggle with mortgages in the North

Personal Finance Editor,Simon Read
Tuesday 16 August 2011 00:00 BST
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A north-south divide is developing among struggling homeowners, according to the ratings agency Standard & Poor's. Research involving 1.5 million mortgages held in the first quarter of the year shows that borrowers in the North of the country are 35 per cent more likely to be in arrears than those in the South.

The agency warned that the Government's planned public spending cuts could exacerbate the divide. Credit analyst Mark Boyce said: "Given the North's public-sector jobs bias, unemployment in those regions – and consequently arrears – could escalate."

The divide also stretched to those in negative equity because of the sluggish housing market in the North, he said. Northern regions accounted for two-thirds of the overall rise in negative equity in the nine months to the first quarter of 2011.

Meanwhile Miles Shipside, director of property website Rightmove, says the UK housing market is insulated from global financial jitters because prices are already "bumping along the bottom".

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