A 10% interest rate on a £30k mortgage is £3k a year in interest
A 5% rate on a £300k mortgage is £15k a year
These Daily Mail talking points have all been debunked countless times
They can only be debunked if you compare like with like though.
The 1990 example quoted for a £30K mortgage would equate to approx half the value of an average house back then while the £300K mortgage is more than an average house now. And mortgage rates have always fluctuated depending on the amount of equity held.
A big consideration is that a mortgage is paid for from take home pay, not gross which seems to be the metric quoted, so you have also to think about the tax position when assessing affordability. There was MIRAS for a while to help, but current income tax rates are also well below previous levels. For a lot of the 80s base rate was 30% and highest 60%, while in the 70s you could have the pleasure of 35% base and 83% top. If you want to get uber granular for fair comparisons then you need to start building in tax thresholds and NI rates too.
Not to mention price inflation - through a lot of the 70s and into the 80s this was at Liz Truss levels the whole time and even when it settled down it was still well above today’s levels - do you think everyone’s salaries kept pace?
And while you can argue about data manipulation with zero hours contracts etc, historical unemployment figures back in the 80s especially were terrifying: 7-11% through the whole decade - those people weren’t buying houses.
If you want to go back to the 70s you can even start looking at stuff like electricity rationing and the three day week. They were not easy times.
So what’s my point? Mainly that every era had issues and it’s phenomenally hard to accurately compare them. But most of the easy headlines should also be taken with a pinch of salt.
