Consumer spending on rent and mortgages in the UK grew by 4.3% year-on-year in June, according to data from Barclays Property Insights. This marks the fourth consecutive month of slowing growth as major lenders continue to lower mortgage rates. Spending on utilities saw a modest increase of 1.2%, attributed to a recent heatwave and a decrease in price caps.
Consumer confidence in the housing market fell by three points to 27% as the Bank of England maintained the Base Rate at 4.25%. However, concerns about barriers to homeownership are easing, with fewer consumers citing property prices and monthly mortgage payments as major obstacles.
Government-backed ownership schemes face challenges with awareness among renters. While over half of renters believe homeownership is unattainable without financial incentives, awareness of initiatives like Shared Ownership remains low, particularly among younger adults.
Jatin Patel, Head of Mortgages, Savings and Insurance at Barclays, emphasized the need for tailored solutions: “Our findings underscore the importance of tailored solutions to address the diverse needs of today’s prospective homeowners.”
Will Hobbs, Managing Director at Barclays Private Bank and Wealth Management, commented on economic conditions: “Data on the economy are telling a particularly incoherent story at the moment... Blind optimism ultimately outperforms sober pessimism when it comes to the economy over longer periods.”
The report highlights that nearly half of tenants find renting more expensive than owning a home. A significant portion of renters is saving for house deposits but are not meeting their savings targets.
Barclays continues to provide insights into consumer trends through its Property Insights division.