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Running a home is cheaper than two years ago

Running a home is cheaper than two years ago

Category: Mortgages

Updated: 28/06/2010
First Published: 28/06/2010

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.
Low interest rates may have hit savers in the pocket over the last two years, but homeowners are reaping the benefits, according to new research.

The cost of owning and running a home in the UK has fallen by 6% since April 2008, figures from Halifax show.

Over the past two years, the average annual cost associated with home ownership fell by £544 from £9,564 to £9,020.

Other figures show that the cost of housing in the UK has fallen by 9%, while housing costs – comprised of bills, tax and maintenance – are now equivalent to 27% of gross average earnings. This has fallen from 30% in 2008.

The biggest contributor to the fall in costs has been mortgage rates, which have fallen by almost a fifth (19%).

Recent research conducted by Moneyfacts.co.uk found that mortgage rates are at a seven year low, and the average mortgage rate paid by homeowners has fallen by 2.13%, from 5.80% to 3.67%.

Unsurprisingly, London is the most expensive region to run a home, with annual costs of £11,762, while homeowners in the South East are forking out £10,457 on average.

"Over the last two years, the cost associated with owning and running a home in the UK has fallen, entirely as a consequence of reduced mortgage payments," said Suren Thiru, housing economist at Halifax.

"The drop in housing costs has helped to ease the strain on household's finances, providing some relief to homeowners during the economic downturn."

Amongst the best two year fixed rate mortgages currently available are a deal from The Co-operative Bank at a rate of 2.95% and a deal from HSBC at 2.99%.

Yorkshire BS also offers a two year fixed rate mortgage deal at 3.05%.

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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 Any products featured may be withdrawn by their provider or changed at any time.

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