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The cost of running a home has fallen

The cost of running a home has fallen

Category: Money

Updated: 14/12/2012
First Published: 15/11/2010

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

In the past two years the cost of running a home has dropped significantly, new analysis has revealed.

In 2010, it costs the average British household £8,059 per year in running costs, whereas in 2008 the annual cost was almost £1,300 more at £9,324 – a drop of nearly 14%, according to Sainsbury's Home Insurance.

This means that the average household now pays £155 per week, or £22.08 per day. The fall in mortgage payments, which account for 43% of all household expenditure, is the main reason behind the lower running costs.Due to low interest rates, borrowers are now paying 28% less on their mortgage payments than they were in October 2008.

The decrease in gas and electricity bills, which have fallen by an estimated 9% and 6% respectively compared with prices two years ago, have also contributed to the fall in household expenditure.

However, the cost of energy will rise for many of British Gas and Scottish and Southern Energy's customers from next month as both firms have announced price increases.

The analysis also found that council tax, which was the next biggest expenditure after mortgage payments (accounting for 17% of household expenditure), has increased by nearly 5% in the past two years.

While families up and down the land will be pleased to hear that their outgoings are likely to have fallen, they could still be paying far more than they need to.There are a number of ways that a family could cut their expenditure.It is worth taking the time to shop around a number of providers to see if you could save on any of your services.

You could find that by combining your energy bills, you could save a significant amount every year, while if you pay for media services in the home, a chat to your provider could result in a renegotiated deal.

If your family has one or more credit cards that are currently being paid off, a 0% balance transfer could potentially save you hundreds, possibly thousands of pounds.

This is because they do not charge any interest for a set period of time – the best deals on the market allow 16 months from the date of transfer – in which you can concentrate on just paying off a balance, without accruing further debt.

Switching your mortgage provider cold also help ease the pressure on your family's purse strings, while taking out comprehensive home insurance cover could save you from any costly damage bills.

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Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

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