Fourteen consecutive increases to the Bank of England base rate have seen bills rise at a rapid pace, and a further interest rate hike could be on the horizon this month.
Here, we explain our findings and outline what help is available if you’re struggling to keep up with household bills.
Housing cost fears reach record levels
Our research shows that 79% of mortgage owners and 81% of renters are currently worried about housing bill costs. That's the highest we've recorded since we launched our tracker in 2013.
Back in December 2021, a little less than half of homeowners were concerned about their mortgage repayments - however that share has increased as a result of 15-year high interest rates.
Find out more:Missed housing payments remain high
An estimated 630,000 households missed a mortgage or rental payment in the month to 10 August.
The average two-year fixed-rate mortgage now has an interest rate of 6.7%, while for a five-year fix it's 6.19% - this compares to 4.24% and 4.33% a year ago.
The Bank of England has warned payments will rise by at least £500 a month for nearly one million households between the end of this year and 2026.
As for tenants, rental bills are currently the highest they've ever been, and there are little signs of costs being scaled back.
According to the latest HomeLet Rental Index, the average annual rent for new lets is £14,916 - that's £1,392 higher than a year ago.
Find out more:What do to if you're struggling with your mortgage or rent
Find out more:Trust in banking sector falls
Our survey shows trust in the banking industry has plummeted to a three-year low.
The graph below details the level of trust people have with different industries, with the gas and electricity sector languishing at the bottom.
More than half make financial adjustments
More than half (56%) of our survey's respondents told us they made at least one adjustment – such as cutting back on essentials, dipping into savings, selling possessions or borrowing – to cover essential spending in the month to 10 August. This equates to an estimated 15.8 million households.
Worryingly, 1.3 million missed or defaulted on a household bill payment in the last month, and 65% failed to pay more than one.
Among these, 50% did not pay their council tax, 48% missed their energy payment and 46% missed their water bill.
The graph below shows how an estimated 7.8% of households are failing to pay bills, compared to 4.5% in August 2021.
Rocio Concha, Which? director of policy and advocacy, said: 'It’s very worrying that so many households are missing housing payments and that consumer concerns about housing costs are at a record high.
'We’d encourage anyone who’s struggling to seek free debt advice and reach out to their mortgage provider or landlord for help.'
*The Consumer Insight Tracker is an online poll conducted monthly by Yonder on behalf of Which?. It is weighted to be nationally representative with approximately 2,000 respondents per wave.
source https://www.which.co.uk/news/article/four-in-five-concerned-about-rising-mortgage-and-rent-costs-a00wr0W5gwFn