Interest rates drive down cost of running a home

New research has shown that the cost of running a home has dropped by 6% over the last two years with record low interest rates largely responsible.

The research, from high street bank Halifax, saw the cost of owning and running a property fall by £544 to just over £9,000 in the two years between April 2008 and April 2010. In that time there has been a 19% reduction in average mortgage payments although other associated costs, such as energy bills, the price of household appliances and the cost of maintaining and repairing a property have all risen by about 10%. The research also shows that housing costs now take up 27% of average full-time earnings before tax, a figure down from 30% in 2008.

The cost of owning and running a home is greatest in London and the South East and is at its lowest in Northern Ireland.

Suren Thiru, housing economist at Halifax said: “Over the last two years, the cost associated with owning and running a home in the UK has fallen, entirely as a consequence of reduced mortgage payments. The drop in housing costs has helped to ease the strain on households’ finances, providing some relief to homeowners during the economic downturn.”