Cost of Owning and Running a Home Reaches New Levels
The cost of owning and running a home is at the highest level since 2008, ne research has found.
The annual cost of owning and running a house is on average up by 1.4 per cent on March last year,according to research conducted by Halifax bank.
The research includes all costs such as mortgage payments (interest and capital repayments) council tax, utilities, insurance, maintenance, household appliances and toiletries.
Despite record low interest rates over the past year the cost of running a home has risen by £127. Interest rates are at a record low of 0.5 per cent for over 26 months. This is the longest period of stability since 1939-1951 .Reason being that electricity and gas prices have risen dramatically since last year adding an average £68 extra to the bill.
Overall, utility bills have risen by 19% (£237) since 2008 the biggest increase of any housing expenditure category. Housing maintenance and repair expenditure saw the next largest increase (17%).General maintenance costs make up £45 in the £127 annual increase.
The outlook however, remains bleak as inflation report shows that energy prices are expected to rise. The Bank of England predicts fuel prices could increase by 15 percent and electricity by 10 percent next year , causing bills to hit £1,279 a year adding to the already soaring cost of living.
This increase would mean households would have to budget for an extra £148 on their bills, following the other recent price hikes in March which added £63 onto the average energy bill. Electricity and gas bills’ proportion of housing costs rose from 13% to 16% as a result of the 19% rise in such costs over the past three years.
All regions across the UK have seen housing costs fall since 2008.
London has the highest annual cost of running at home at £11,783 and the lowest is in the North East at £7,42. In relation to earnings the East of England has the highest ratio of 31 per cent.
A recent study also revealed that Londoners are the least financially savvy people across the UK with the Welsh and Scottish having the most knowledge over their finances. Over eight in ten residents in Scotland and Wales know about PPI compared to 73 percent of residents in London.