MortgagesMar 7 2023

Half of mortgage holders say rising costs affect mental health

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Half of mortgage holders say rising costs affect mental health
At 10.1 per cent, inflation remains close to an all time high.(Chris Ratcliffe/Bloomberg)
ByJane Matthews

Some 56 per cent of UK mortgage holders have said the cost-of-living crisis is affecting their mental health, as inflation remains at a peak.

Survey data of 2,000 UK adults has shown that the majority of UK adults are under significant financial pressure, with 69 per cent worried about the financial future for themselves and their families.

Conducted by financial software firm Dye & Durham, the research showed that mortgage holders are facing particular pressure, with almost a third (30 per cent) worried they will fail to make mortgage repayments within the next year. 

Additionally, 36 per cent of respondents said they could only continue to pay their mortgage for two months if affected by a job loss - a stat that Dye & Durham noted could be a warning sign that repossessions could become a rising risk for the UK’s property market.

“The effects of high interest rates, energy bills and the increased cost of living overall cannot be underestimated. 

“Our survey data shows Britons are extremely concerned about both their short- and long-term future and have reduced spending, raided savings and are delaying major purchases,” Dye & Durham chief operating officer, Martha Vallance said.

Inflation remains close to an all time high, sitting at 10.1 per cent in February.

However, it has been slowly tracking down from the recent high of 11.1 per cent in October as wholesale natural gas and fuel prices fall.

Despite this, the general public are not set to see the pressure ease in the short term. 

Last week, Bank of England governor Andrew Bailey said energy bills are not expected to come down to previous levels “any time soon”.

“From a cost-of living perspective, it is the level of what people have to pay that matters. There will be some relief, but energy bills will remain a challenge for many people, particularly for those on lower incomes,” Bailey said.

Bailey also pointed to the unprecedented rate of food price inflation, which was nearly 17 per cent higher in January 2023 than the previous year and noted that this is a significant challenge for people.

The survey results from Dye & Durham illustrate this, 43 per cent of respondents said they have taken to selling personal items to better manage household budgets while 55 per cent have made personal sacrifices so their family and children are not impacted.

These sacrifices include eating less or not buying clothing or shoes for themselves.

Meanwhile, 25 per cent of respondents said they have had to delve into savings to cover day-to-day expenses such as food and heating.