Call for flatmate mortgages

With the rent from a typical spare room worth £365 a month (with bills on top), the extra income would make a significant difference to how much a first-time buyer could borrow if lenders took it into account. Campaigners say that typically, it could increase the amount people can borrow safely and prudently by 20%.

Flatshare website,, which is spearheading the campaign, says that without flatmate mortgages, nearly a quarter of would-be buyers believe buying a property is impossible, whilst almost a third believe they will have to buy with someone else in order to afford to get on the housing ladder. And 89% of would be first-time buyers polled by wanted flatmate mortgages to be introduced.

Average house prices are now 4.9 times the average income. A year ago, it was only 4.3 times. 28% of those polled say they must continue to save every penny to build a deposit. Someone earning the UK’s average salary, £26,000 can borrow between £47,600 and £65,400 (after non-housing related monthly outgoings). However, if lenders included the £4,392 yearly income an average homeowner could earn renting a room (approximately £365 per month), this could rise considerably. By allowing 2.5 times this income to be borrowed, flatmate mortgages would allow the average borrower access to an extra £11,000. It would take a young adult more than four and a half years to save that amount in a deposit - even if they were squirreling a whopping £200 extra away every month.

Jonathan Moore said: “Flatmate mortgages are totally viable and have been used before. And they’re a safe bet for lenders. On average, flatmates stay at an address for 3 years, so the full amount of the extra loan would be earned on the first flatmate. Sensible live-in landlords don’t take in flatmates without legally binding contracts - which ensures monthly rent for the duration of the agreement. So 6-12 month contracts should give flatmate mortgage lenders at least as much peace of mind as standard 6 month Assured Shorthold Tenancy does to buy-to-let lenders.”