New research from Barclays has found that recent changes to stamp duty are causing concerns for next-time buyers.
Rent and mortgage spending increased 8.2% year-on-year last month, reaching a 14-month high, according to the latest Barclays Property Insights report.
Despite increased costs, consumers have maintained confidence in their ability to afford housing payments, though stamp duty changes have hampered plans for some next-time buyers. Meanwhile, improving home energy efficiency remains a priority for the winter months ahead.
Concerns around rising interest rates dropped slightly to 59% in November, down from a high of 63% in June 2024, following the Bank of England’s decision to reduce the base rate to 4.75% earlier in the month.
When asked about their household expenses, 41% reported being very concerned about rising household bills, with 56% also somewhat worried about the impact of rising rent or mortgage costs.
Meanwhile, 41% of Brits are adjusting their spending habits to offset rising housing costs, with 29% saying they are looking for ways to save money on their rent or mortgage.
Energised by energy-saving
Spending on utilities was down by 10.6% year-on-year in November, as prices remain below 2023 levels. However, this is the smallest decrease since July 2024, reflecting the energy price cap rise which came into effect on 1 October and the arrival of colder weather.
Meanwhile, 25% of homeowners are making improvements to their homes to increase their energy efficiency. Of those making changes, 52% are seeking to reduce long-term energy use and 19% hope to improve the value of their property.
The most popular improvements are loft insulation (48%), wall insulation (37%), double or triple glazing (35%), and fitting solar panels (33%).
However, although some consumers are already taking these steps, the Bank’s recent report, Electrifying the Future: boosting the Energy Efficiency of UK Homes, found that 35% are dissuaded from making improvements to their homes because they don’t understand which options are right for their property.
Some homeowners are also reluctant to shoulder the financial burden of retrofitting, with 69% of those identified as ‘able to pay’ saying the Government should fund retrofitting activities, with a further 67%believing the Government needs to take action to change how the nation heats or cools its homes.
Purchasing dreams not ‘stamped’ out
23% of homeowners state that the cost of Stamp Duty is the biggest barrier to buying their next home. This tax is even more significant for younger homeowners, at 39% of 18–34-year-olds, compared to 15% of over 55s.
Amongst renters, only 7% say that the recent changes to Stamp Duty in the Chancellor’s October budget will delay their home-buying aspirations, although this rises to 27% in London. In contrast, 64% agree that property prices are the biggest barrier to buying a home.
For renters taking steps to save up for their housing deposit, trying to reduce monthly bills is most popular (37%), alongside reducing discretionary spending (37%). 30% said they were cutting back on holidays to save cash, with a similar proportion investing in order to build their housing fund.
Brits rein in seasonal decorations
With Christmas fast approaching, sustainability and budgeting are front of mind, as two-fifths of those who celebrate Christmas (42%) are choosing to reuse decorations over buying new ones, and 24% of those trying for a more sustainable Christmas are opting for LED light bulbs.
51% are choosing to forgo buying a Christmas tree or decorations this year; with the average celebrator intending to spend £33.30 decking the halls, compared to £204.20 on presents, £51 on festive parties and socialising, and £41.90 on travel to see friends and family.
Renters were more likely to opt out of spending on seasonal interiors (56%), but also reported limitations in their ability to decorate, with 12%, saying that their housing situation prevents them from decorating for the festive season in the way they’d like to.
Mark Arnold, Head of Mortgages and Savings at Barclays, said: “The rise in rent and mortgage spending dampens some of the optimism felt following the recent drop in interest rates. For mortgage holders coming to the end of fixed rate deals set in or before 2022, they will only now be feeling the impact of the interim rate volatility. These effects are then being passed through to the rental sector, through higher rents and reduction in supply.
“We are seeing some positive news with homeowners interested in retrofitting measures, which has the dual effect of benefitting both the environment as well as consumers’ back pockets. However, there remains more to be done to build awareness and understanding of the options available. This is where we see the Government being able to play a key role, helping to bring together the public and private sectors to collectively harness consumer interest and help accelerate efforts to make UK homes more energy efficient.”