First time buyer affordability ratios in the UK

Here's a chart based on Table ML2 from the Council of Mortgage Lenders statistics page, which shows the years 1974 to 2007. The red line is 'interest payments as a % of income' (left-hand axis) and the blue line is 'loan as multiple of income' (right-hand axis). The typical LTV was between 85% and 90% for most years, so that does not seem overly relevant.
So, all this chat about 'affordability' is a smokescreen - the loan-to-income ratio is at an all-time high of 3.36, so if average interest rates for FTB's have increased by 1.5% from a very low figure of 5.75% in late 2007 to about 7.25% as at April 2008, this will push the interest-to-income ratio from 19.4%* up to 24.4%, which is precisely the pain threshold at which the market turned in 1989.

Assuming average interest rates for first time buyers with a 10% deposit stay constant, prices would have to fall by about half (relative to wages) before they reached the lows of 1977 or the early 1990s, where a natural floor was reached, i.e. it is far cheaper buying than renting.

* Update, as Matthew points out, the spreadsheet has been updated and the figures for February 2008 are loan-to-income ratio 3.33 (i.e. down by 1%) and the interest-to-income ratio, which had risen to 20.7, is now at 20.1, so things are slightly worse than I thought.