Browsing "Home and Living"
I’ll be sorry to leave my merry little apartment at the end of the month. I’ve grown rather attached to my little penthouse of (almost) three years. But like thousands of others, I’ve fallen victim to housing and rental costs spiralling well above the average rise in earnings.
The rent has been hiked beyond what I can reasonably afford, and there’s little that can be done about it. That’s just how the market is right now.
To put this into context: in the year to April, house prices in England rose by 10.4%. They’re now worth over 10 times the average salary in high-demand areas.
Meanwhile, the average cost of renting a home increased by 2.9% between March and April to £848 per month, according to the latest HomeLet Rental Index. This makes average UK rent 7% higher than during April 2013.
If you’re unfortunate enough to be vying for a rental property in Greater London, average rents here increased by 9.4% over the year to an average of £1,348. Sheesh!
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At long last, the economy looks to be back on surer footing. Confidence is higher, the housing market is buoyant, and wages have finally risen to match inflation for the first time in six years. But the political wrangle in the build up to the next election is likely to be about living standards.
Though many of our costs dipped as a result of the financial crisis, we’re still likely to find ourselves much worse off than we did at the start of the Coalition government. A new infographic from Vouchercloud shows how we’re trailing in the wake of rising costs.
The most startling rises have occurred in housing, education, and energy. When adjusted for inflation, average gas bills have more than doubled in the past decade (+108%), while electricity bills have hiked by 53%. Petrol prices took a hit during the recession but have made a strong recovery to reach a third above their 2003 levels (+34%). And two rises in tuition fees, to £3,000 in 2006 and £9,000 in 2012, have made the costs of university unrecognisable from a decade ago.
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How does this compare to what we earn? In real terms, wages have shown barely any progress over the last decade, as the financial crisis suppressed the ability for earnings to grow. There are now signs that earnings are beginning to regain some lost ground, but persistant above-inflation rises in essential costs such as energy and transport have left a hefty dent in the pocket of most average earners.
Mercifully, consumables – including food prices – have remained relatively meek. But those whose earnings have not risen in line with inflation over the last few years will still have felt the pinch from their grocery shopping. And what this graph doesn’t show is the decline in the returns offered by savings accounts in recent years, which has resulted in further real-term losses for diligent consumers.
It remains to be seen how prices will adjust when interest rates begin to rise, but it will be particularly interesting to note how the cost-of-living crisis is used rhetorically when political debate heightens ahead of the next election.
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“Introducing such a major change to the mortgage market at the peak of the house buying season is bizarre and somewhat foolhardy,” says Paul Winter, the chief executive of Ipswich Building Society. Mr Winter believes that the new mortgage regulations could be much better timed, and he is adamant that so-called “mortgage misfits” should not lose out as a result of them.
As part of the new Mortgage Market Review due to come into effect this weekend (26th April), lenders will be required to undertake more detailed affordability checks on mortgage applicants. Lenders will have to conduct interviews with new applicants to investigate their lifestyle and spending habits.
Inevitably, there are concerns that the stricter lending criteria could make it harder for so-called “mortgage misfits” to get onto the housing ladder. Categories including self-employed applicants, small business owners, and those who earn below £25,000 a year, could all be more vulnerable to rejection from banks that use an automated assessment system.
But the Ipswich Building Society has pledged to help these groups who would otherwise lose out as a result of the stringent new guidelines. Below, Paul Winter, its chief executive, answers ten questions about the new mortgage guidelines and Ipswich’s approach to them.
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Most of us can sniff out a dodgy deal a mile away, but sometimes those too-good-to-be-true offers do dig away at the defences. Consumers are currently being warned to watch out for new ‘bargain’ mattresses being sold from the back of vans, which could be unsafe, unhygienic, and downright dangerous.
The Trading Standards Authority and the National Bed Federation (NBF) have issued the warning, amid concerns that consumers could be at risk from disease or further harm from these substandard goods.
The NBF believes that thousands of dangerous “bargain mattresses” are being flogged across the country every week.
Hundreds of people are being fooled into thinking they are landing a bargain on a new mattress when they appear to be new and in mint condition. Only, in most cases, these are discarded mattresses that have been repackaged with new covers to appear as new to unsuspecting eyes.
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By using a smart meter to gain insight into where energy is being wasted, we could save £75 a year on our energy bills, according to British Gas.
One reason why our gas and electricity bills are higher than they should be is because we lack insight into where energy is being used around the home.
The demands and dynamics of modern living mean that we now own far more electronic devices than we used to, so our demand for energy is greater.
This, in turn, makes it harder to monitor everything. We invariably end up forgetting when things are plugged in or left on, and our use of energy can become increasingly inefficient.
However, there are solutions at hand to help with the problem for those who wish to try and reduce their energy consumption.
Recent research by British Gas shows that people are benefiting from the use of smart meters.
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It’s only recently, when we launched our New Year competition to give away a Harrods hamper, that my eyes were finally opened to the vast world (or, perhaps, the sport) of online competitions.
Some of the entrants to our recent sweepstake are self-confessed ‘addicts’ of online competitions. That’s quite powerful rhetoric under any circumstances.
Let’s make no mistake, though: there are some wonderful prizes to be won out there. So it’s no straightforward ‘addiction’ in the normal sense, I don’t think. There’s a steely entrepreneurialism at work here, on the part of the entrants, in the hope of landing all sorts of monetary and material rewards.
And with that, as I’ve seen, it’s communal, good fun, and great for engaging friends and family.
So good on you all, I say! Though money saving arguably receives more time and effort at Which4U than money making, there’s nothing to say that the two cannot co-exist.
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