The cost of owning and running a home in the UK has fallen by nearly a fifth over the past year, according to new research by Halifax.
Between April 2008 and April 2009, the average annual cost of housing fell from £8,766 to £7,298, a decline of 17 per cent (£1,468).
Housing costs currently account for 23 per cent of average UK full-time earnings, down from 28 per cent in 2008. The expense of owning and running a home is at its lowest since 2006.
The significant fall in housing expenses over the past year was driven by a 47 per cent decline in mortgage interest payments. The average mortgage rate2 fell to 3.62 per cent in April 2009 from 5.80 per cent a year earlier.
Mortgage interest payments were the only housing expense category to experience a fall between April 2008 and April 2009. The largest upward pressure on housing costs came from electricity and gas charges, which have risen by 13 per cent (£159) over the past year from £1,249 in April 2008 to £1,409 in April 2009. Routine maintenance saw the next largest increase (7 per cent).
Suren Thiru, economist at Halifax, commented: "With mortgage interest payments declining by almost half over the past year, the annual cost associated with owning and running a home in the UK has fallen significantly. Such a sizeable drop in the costs of running a home will help to ease the pressure on household disposable income, providing some welcome relief to homeowners.
"Those living in London saw the biggest fall in housing costs over the past year, although the average annual expense of owning and running a home in the capital remains somewhat higher than elsewhere in the UK."
Date: 1st, July, 2009
Author: Ben Wilkie
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