Spending plans altered as credit crunch hits consumers

Posted: 07 May 2008 14:57:15 GMT

The credit crisis is impacting on people's spending habits, it has been revealed.

The credit crisis is impacting on people's spending habits, it has been revealed.

Research by the Fair Investment Company shows many Britons are feeling the pinch and plan to adapt as a result.

In order to accommodate for increasing mortgage repayments and every day bills, 23 per cent of respondents said they would be cutting down on life's luxuries, 16 per cent will sacrifice a holiday, 13 per cent will switch energy suppliers and four per cent plan to change their mobile phone contracts.

However, 17 per cent do not plan to alter their spending habits at all - a fact that alarms Fairinvestment director David Doulton.

"I am surprised by the percentage of people who do not intend to make any changes to their spending habits; I can only assume that these people either do not have mortgages or are still enjoying a fixed rate.

"As we have seen over the past few weeks, the housing market has, so far, been the worst hit by the credit crisis; lenders have rapidly been pulling their best deals, and the structure of mortgages has been re-arranged to include fees and abnormally large deposits.

"People having to re-mortgage at the moment will undoubtedly be left with less spare cash at the end of the month."

Homeowners have been hit by the lack of available mortgage deals on the market, meaning many are now paying more to service their mortgage than they were this time last year.


© Houseladder Ltd

MORE UK PROPERTY NEWS: May 2008

Prime market going strong  Posted: 13 May 2008 11:02:12 GMT
The UK's prime property market continues to perform well despite the global credit crunch.

Region strategy for east of England receives mixed response  Posted: 13 May 2008 11:01:11 GMT
The government has published its Regional Spatial Strategy (RSS) for the east of England.

Financial advisors have a role to play  Posted: 12 May 2008 11:40:56 GMT
Independent financial advisors have a role to play in helping homeowners in financial difficulties.

Rise in millionaire households  Posted: 12 May 2008 11:40:14 GMT
A new report has revealed a substantial rise in the number of UK properties sold for at least £1 million.

Tory leader to speak on countryside housing issues  Posted: 09 May 2008 13:17:53 GMT
David Cameron is to give a speech on the future of the UK countryside.

Market conditions suit some investors  Posted: 08 May 2008 10:49:39 GMT
The collapse of investment company Inside Track should not be of concern to buy-to-let property investors who look to the long-term.

Rics calls for mortgage continuity  Posted: 08 May 2008 10:49:12 GMT
The Royal Institution of Chartered Surveyors (Rics) is keen to see more continuity in the mortgage market.

Buyers' market enables first-time buyers to drive a hard bargain  Posted: 07 May 2008 14:58:04 GMT
First-time buyers are forcing down property prices, it has been claimed.

Spending plans altered as credit crunch hits consumers  Posted: 07 May 2008 14:57:15 GMT
The credit crisis is impacting on people's spending habits, it has been revealed.

Buy-to-let market affected by credit crunch  Posted: 06 May 2008 13:23:34 GMT
A rise in the demand for rented accommodation has not been accompanied by an increase in the number of buy-to-let mortgage products on the market, it has been revealed.

Gazundering issue leaves Brits in a flux  Posted: 06 May 2008 13:21:05 GMT
UK homebuyers have strong opinions when it comes to the issue of gazundering - but many of them are conflicting, it has been revealed.

Govt needs to focus on empty homes  Posted: 02 May 2008 11:02:01 GMT
The government needs to look at bringing empty homes back into use if it is to meet its housing targets.

Poll points to rate freeze  Posted: 02 May 2008 11:01:09 GMT
A new poll suggests that the Bank of England's Monetary Policy Committee (MPC) will wait until June before cutting the base rate of interest.

SLS receives CML support  Posted: 01 May 2008 12:23:58 GMT
The Bank of England's Special Liquidity Scheme (SLS) has received support from the Council of Mortgage Lender.

Lenders and intermediaries remain upbeat  Posted: 01 May 2008 12:23:24 GMT
It appears that many mortgage lenders and intermediaries remain confident about the prospects for the housing market in 2008.

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