Half of Britons Struggle to Keep Up With the Increasing Cost of Living
Nearly half of the population in the UK is struggling with rising costs of running a household after inflation has reached its highest in the last four decades, warned the Resolution Foundation research institute.
As reported, around 44 percent of working households were falling behind on rent and mortgage payments in November last year, compared to 26 percent in January 2021, Bloomberg reported today.
The survey was conducted on a sample of 10,470 adults, and the results of the research point to a cost of living crisis, further exacerbated by the pressures of the Covid-19 pandemic.
Renters, who are facing the fastest rise in rents in a decade, are particularly affected, with as much as eight percent of them falling behind on their housing costs.
The study paints an even gloomier picture for social housing tenants, as 19 percent of them stated they are falling behind on payments, while as much as 44 percent are struggling to pay for housing costs, effectively meaning many of them are unable to replace electrical appliances or turn on the heating.
At the same time, mortgage borrowers have been hit by an unprecedented wave of interest rate hikes by the Bank of England. It is expected that the central bank will continue with its tenth consecutive increase on Thursday, with the reference interest rate predicted to reach 4.5% by May. The proportion of mortgage borrowers who are falling behind or struggling to pay their payments has almost doubled from 27% to 50% between January 2021 and November 2022.
Despite the sharp rise, the overall number of credit-indebted individuals facing financial difficulties in repayment is still lower than that of tenants.
-“Given that many people renting are already stretched financially, the pressure of inflation and rising rents has a strong impact on their household budget and wellbeing,” said Kara Paciti, senior economist at the research centre.
With the expected increase in living costs, the situation for tenants will worsen, unless the government intervenes, the research has shown.