Rising cost of living could deter potential buyers

Eight in 10 consumers are worried about the rising cost of living over the next six months, according to a new YouGov poll.

This national survey found that 39% were ‘very worried’ about the cost of living squeeze, with a further 45% describing themselves as ‘quite worried’.

The findings come ahead of the Chancellor’s spring budget, where he is under pressure to delay planned tax and NI increases in the face of soaring fuel and food bills and rising interest rates.

Alongside this YouGov survey, a separate study by Bluestone Mortgages found that the rising cost of living was a major concern among consumers traditionally underserved by the mortgage market, such as the self-employed and those with a credit history. poor or non-existent.

Bluestone’s survey found that 67% of this group said the rising cost of everyday items was a top concern. This compares to just 35% who cite financial instability as a concern and 33% who say they are concerned about rising interest rates.

Almost one in five (18%) thought their financial situation was likely to deteriorate over the next year, making it difficult to get a mortgage.

Mojo Mortgages co-founder and managing director Richard Hayes said: “The Chancellor faces tough choices ahead of next week’s spring statement, with the cost of living crisis putting significant pressure on finances. Household.

“Many homeowners are worried about rising interest rates and the impact this will have on repayments at the same time as household budgets are stretched.

“As the cost of living continues to rise, we may see increased scrutiny of the affordability of certain mortgages, which would have a greater impact on first-time buyers. Our own research shows that first-time buyers in some areas would already need to borrow up to 7.5 times their income to buy a property at the average price.

“The housing market remains buoyant, with Zoopla reporting that 2022 had the busiest start to the year since 2016. However, with mounting pressure from rising energy bills, rising National Insurance contributions and rising interest rates, support for homeowners from the Chancellor would be welcome.

Bluestone Mortgages managing director Steve Seal adds that it’s also a problem for those looking to move up the housing ladder.

“The rising cost of everyday items, soaring energy bills and the upcoming increase in National Insurance contributions will all impact affordability and put further pressure on the cost of living. .

“As a result, many consumers are likely to delay the homeownership process for fear of rejection, or they may have already been turned down due to their more ‘complex’ needs.

“While challenges persist, it is important for those disenfranchised from high street lenders to remember that there are options available, and it is the duty of these lenders to steer them in the right direction.

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