Mortgage repayments will take an increasing priority in a third of households’ spending in 2013, according to a survey by Legal & General Mortgage Club (L&GMC).
Of those increasing spending on mortgage payments, 82% will cut spending on hobbies and their social lives, 78% on clothing, and 68% on food shopping. However, two thirds of homeowners have stated they will not increase their financial commitments to mortgage repayments.
Ben Thompson, Managing Director of L&GMC, said the desire to meet mortgage repayments is to be expected, but ‘the fact that so many intend to cut back on groceries and clothing shows that austerity is still biting up and down the country.’ Homeowners in Wales and the North West plan to make the most cuts in their spending, while those in the West Midlands and East Anglia are least likely to change their spending habits.
The survey also reported that 44% of first time buyers intend to put down a deposit within the first six months of the year while 14% plan to do so in the second half. Moreover, 13% plan to start saving for the deposit in 2013, and a quarter hopes to pay off outstanding debts in order to start by 2014.
While Thompson expects 2013 to show some positive signs in the housing market, he says first time buyers are still struggling due to a lack of suitable housing. As such, ‘it would help if the Government were able to increase its focus on building new, affordable homes to help these people get a foot on the ladder.’ With the Planning Minister’s intended plans for local communities to create robust housing plans, 2013 might see an increase in first time buyer new build mortgages.
