House cost increases ‘causing consumers to struggle’

Rising house prices are continuing to squeeze households’ debt management, it has been suggested.

According to figures released by Capital Economics, repayments on personal loans and other forms of debt accounted for 22 per cent of household income in 1990.

However, following the Bank of England’s latest interest rate rise this proportion is set to rise to 23 per cent.

Capital’s UK economist Vicky Redwood told Scotland on Sunday: "This means affordability is being squeezed at historically painful rates."

"Some households will undoubtedly begin to struggle," she added.

The publication added that following the fourth base rate increase in the space of 12 months, the average £100,000 mortgage borrower now has to find an extra £80 every month.

Meanwhile, mortgage repayments were reported to have "typically doubled" since 2003.

Last week, Adrian Coles, director general for the Building Societies Association, claimed that the rise could cause difficulties for those making repayments on home and Secured Loans.

Interfinancial providing you with breaking secured loans news.