However, the month-on-month difference in housing costs was marginal (-0.01%), suggesting consumers may not be feeling worse off in the short term
Spending on rent and mortgages rose 6.3% year-on-year in May – faster than April’s rise of 3.6%, according to data sourced from Barclays current accounts.
Meanwhile, consumer confidence has declined as Brits also started to feel the impact of increasing household bills like broadband and council tax.
Nevertheless, the month-on-month difference in housing costs was marginal (-0.01%), suggesting consumers may not be feeling worse off in the short term, especially in light of the drop in the Ofgem energy price cap in April which led to consumer spending on utilities dropping -12.5% in May.
Additionally, Barclays says signs of optimism are emerging due to dropping inflation and energy prices, and higher spending on home improvements show indicators of recovery for the sector.
Some comfort is being taken from the latest inflation figures, with six in 10 (62%) saying the slowdown has made them more able to live within their means, and a similar proportion (56%) feel more confident in their household finances. In the meantime, confidence in the strength of the UK housing market increased marginally last month from 25% to 27%.
Getting on the property ladder is still seen as a major milestone for many Brits, with a tenth (10%) of people who have never owned a property saying they feel under societal pressure to be a homeowner. Three in 10 (30%) cite the cost of a deposit as the biggest hurdle to buying a home, whilst 18% say they are delaying entering the property market because of high interest rates.
Looking at the Bank of Mum and Dad, the older generation received less help from parents to purchase their first home – 10% of over 55s say they received financial support, compared to 19% of 18-34-year-olds.
For those who have bought property, motives were varied – 30% purchased a home because it was cheaper than renting in the long term, while 24% said they got on the property ladder as it was a good investment.
Mark Arnold, head of savings and mortgages at Barclays, said: Our latest spending figures show that rent and mortgage payments are still posing a challenge for consumers. However there are encouraging signs of improvement ahead, with dropping inflation and interest rate reductions in Europe giving hope that the BoE will follow suit in the coming months.
The post Mortgage payments rise 6.3% year-on-year first appeared on Invest for Property London, Buy Residential property UK.
Credit: Source link
