UK households are grappling with a significant surge in housing expenses, with overall costs climbing by 41% over the past five years, according to new analysis. Property group Savills reported that Britons collectively spent a record £226bn to keep a roof over their heads last year, an increase of £66bn since 2018. This substantial rise has placed considerable strain on both homeowners and renters across the country.
A major driver of this escalating cost has been the sharp increase in mortgage interest payments. Savills highlighted that borrowers completing fixed-rate deals have been particularly hard hit, with higher interest rates accounting for half of the overall rise in housing costs. While the Bank of England's base rate has seen multiple increases in recent years to combat inflation, impacting mortgage affordability, lenders like HSBC and Nationwide have recently adjusted some rates downwards, offering a glimmer of potential relief for some future borrowers.
Beyond mortgage holders, renters have also faced substantial increases in their outgoings. Data from property portals like Rightmove and Zoopla has consistently shown robust growth in rental prices across the UK. For instance, Rightmove's recent reports indicate average asking rents outside London have continued to rise, albeit at a slower pace in some regions, reflecting persistent demand outstripping supply. This dual pressure on both owners and renters underscores a widespread affordability challenge.
The impact of these rising costs is not uniform across the UK. Regional variations in house prices and rental markets mean some areas have experienced more acute pressures than others. While specific data on regional cost increases was not provided in the Savills analysis, general trends from sources such as the Land Registry and Zoopla indicate that while house price growth has slowed nationally, affordability remains a significant hurdle, particularly in the South East and London where average property values are considerably higher than the UK average.