17th December 2014
Over a quarter of consumers say that they will cut down on spending this Christmas compared to previous years, so that they can pay the bills and make their monthly rent or mortgage payments.
This change in mood reflects higher housing costs as rent and house prices have gone up, according to the Building Societies’ Association’s Property Tracker survey.
For 56% of first-time buyers and second steppers, raising a deposit is still the biggest single barrier to ownership.
The consumer survey also shows that if interest rates were to go up by one percentage point in 2015, more than one in ten borrowers would be forced to miss a payment on a bill.
A further 13% agreed that it would be a struggle to keep up with their everyday commitments.
Paul Broadhead, head of mortgage policy at the Building Societies Association, said: “These results show that the rising cost of housing is preventing or putting people off buying, but renting is far from being a cheap option for most. The underlying problem is that we are still building too few new homes, with demand far outstripping supply.
“The reform of stamp duty is welcome and will give new buyers some additional cash towards a deposit, but more than half of consumers’ class raising a deposit as the biggest barrier to owning a home.
“Clearly more needs to be done to alleviate housing issues in the UK. Some positive steps have been with announcements such as the Government pilot in Northstowe, Cambridge, where they will build homes for sale on the open market. However, in the lead up to the General Election, we are campaigning for housing to be treated alongside health and education, they are all crucial. We need a Housing Minister in the Cabinet, putting housing issues at the top of the political agenda.”