UK housing costs hit £200bn for the first time in 2023, according to the latest research by Savills.
The analysis of private and social rents plus owner-occupier mortgage costs reveals a £22bn increase on the year.
This was attributed to “unusually strong rental growth and higher interest rates for those who were either on a variable rate, came to the end of a fixed-rate deal or moved home.”
It means the nation’s housing costs have risen by a total £34.3bn in the past two years (+21%); three times that seen in the preceding five, said Savills.
The agent estimates a further 1.2m borrowers will roll of relatively cheap fixed rate mortgages in 2024. At the same time, the number of older households owning their home outright continues to rise, hitting an estimated 9.57m in 2024 across the UK.
Lucian Cook, head of residential research at Savills, said: “The increase in housing costs has been unevenly distributed, with more younger households immediately affected by the rise in rental costs with many owner-occupiers on fixed rates remaining insulated from the turbulence seen in the mortgage markets.
“Although fixed rates have eased back recently, the delayed impact of rate rises will mean further increases in the nation’s housing costs in 2024 as more homeowners come off fixed rates, putting a further squeeze on household budgets.”
