The Office for National Statistics (ONS) has revealed that 30% of adults currently paying off a mortgage or facing rent bills find it very or somewhat difficult to afford housing costs.
The data, which was gathered from the Opinions and Lifestyle Survey between 16 and 27 March, showed the differences in reported increases between rents and mortgage payments, with renters (39%) more likely to report some difficulty than mortgagors (21%).
Despite around 30% of those paying off a mortgage or rent reporting difficulty affording housing costs, only 3% of adults claimed to be behind on rent or mortgage payments.
Commenting on the latest figures, Quilter chartered financial planner Rosie Hooper says: “With many settling into a post-pandemic life with the worst of the restrictions behind them this period should have been a positive time. However, with the cost-of-living crisis stretching people’s finances like never before it may for some prove to be even more challenging.”
Hooper says it’s “scary” that 30% of people are finding it hard to service their mortgage and/or loan, or rent, or shared ownership payments.
“If finances are stretched even further and this difficulty becomes an impossibility, we could have a significant problem on our hands with thousands of people defaulting on their payments and potentially losing their homes,” she explains.
“If you feel that your mortgage is becoming unmanageable then it’s important to talk to your lender as soon as possible. Burying your head in the sand is the worst course of action although often the seemingly the easiest in the short-term. There are a variety of ways lenders can help and they will work with their customers to create payment plans that may be able to help ease the financial burden.”
Among all adults, 17% reported borrowing more money or using more credit than they did a year ago.
It also showed that 43% of adults reported that they would not be able to save money in the next 12 months. This figure represented the highest percentage since the question was first asked in March 2020.
Hooper comments: “Generation rent who have already had to suffer ever increasing house prices are now going to struggle even more to save for that elusive deposit to get on the housing ladder. The ONS analysis found that 43% of respondents reported that they would not be able to save money in the next 12 months, which will mean any house purchasing plans will need to be put on hold until once again deposit pots can start to be funded again.”
“This may further take the wind out of the sails of the housing market as fewer potential buyers reduces demand and house prices with it. We are in for a tough few months or even years but it is always best to seek help if you are struggling with your finances to avoid spiralling into debt,” she adds.