A major study has found that the cost of keeping a roof over one’s head in Britain has risen by 41% in just five years. Total expenditure on rent and mortgages reached a record £226 billion last year, up £66 billion from half a decade ago. The data suggests that the financial burden of housing is becoming an increasingly large part of the average household budget.
The most significant factor in this rise is the increasing cost of mortgage interest, which now totals over £53 billion. As borrowers come off fixed-rate terms, they are often forced to accept rates that are double or triple what they previously paid. This shift has added billions to the nation’s collective housing bill in a very short period.
While the pace of the increase slowed to 3.6% last year, the cumulative effect remains a heavy burden for many. London continues to represent the largest share of the total bill, accounting for over 23% of all housing costs in Britain. However, the fastest growth rates are being seen in northern and eastern parts of the country.
Residential researchers warn that the “long tail” of these interest rate hikes will impact the economy for years to come. With mortgage rates recently topping 5% again, there is little sign of immediate relief. Global events, including conflicts in the Middle East, are cited as a primary reason for persistent inflation and high rates.
Despite the high cost of borrowing, the housing market remains remarkably resilient. Sales figures are currently 5% higher than they were in 2024, and the number of homes for sale is at its highest point since 2015. This suggests that while expensive, the market remains “steady” and functional for those looking to move.