Cost of owning and running a home hits new high

The Momentum UK Team 03 April 2013

The average annual cost of owning and running a home hit £9,590 last year, up £179 from £9,411 in 2011 according to a report by Halifax.

The 1.9% increase came in below the 2.7% level of inflation across the same period, but is the third successive increase seen since 2010.

Housing costs have increased across all parts of the UK in the last year according to the report, but only Northern Ireland (4.8%) and Wales (4.1%) have seen rises outstrip inflation.

However, between 2008 and 2010 the cost owning and running a home fell, largely due to the drop in the cost of mortgage repayments, and as a result, the overall rise in costs across the last five years sits at 2%, compared to an 18% rise in inflation across the same period. 

Martin Ellis, housing economist at Halifax, said:

"The typical costs of owning and running a home have again increased slightly over the past year, although this rise was below the general increase in the cost of living.

"Overall, the cost of owning a home has increased by 2% over the past five years, representing a significant decline in real terms. Lower mortgage payments have largely offset increases in other items of housing-related expenditure, such as the substantial rises in electricity and gas bills."

Six out of the 11 categories that were tracked in the study saw a percentage rise including water bills, up by 5.6%, and electricity and gas bills, up 4.2%.

Separate research by the Debt Advisory Centre, also released today, suggested that in the UK as many as 4 million adults are in debt to at least one of their utility providers.

Of those surveyed, 26% admitted to having ignored utility bills in the past because they could not afford to deal with them.

Of those owing on their electricity bill, 41% have been in arrears for three months or more, while the figures for those owing on their gas and water bills are 33% and 38% respectively.