Data collated by the Office for National Statistics (ONS) found that 30 per cent of people paying rent or a mortgage were struggling to keep up. This is compared to 26 per cent of people reporting difficulties from March to June.
Broken down by tenancy, 39 per cent of renters reported finding payments unaffordable compared to 23 per cent of those with a mortgage.
Rising energy bills are also adding pressure to household finances as overall, 45 per cent of adults said they were struggling to pay for these utilities in the four months to September compared to 40 per cent in March to June.
Renters are finding it harder, with 60 per cent having difficulties with the affordability of energy bills while 23 per cent of those with a mortgage said the same.
Despite this, people seem to be keeping up with payments for the most part as just three per cent of adults reported being behind on their rent or mortgage payments and five per cent were not keeping up with energy bills. This was broadly flat on proportions of two per cent and four per cent respectively in the previous polled period.
Downsizing becoming a ‘real consideration’
Rio Stedford, financial planning expert at Quilter, said: “Interest rates have been rising to try and combat rampant inflation. But due to fuel being thrown on the fire during the mini Budget, interest rates are projected to rise even further later this year. Lenders have been quick to up their mortgage interest rates on all products, which means that homeowners with fixed rates coming to an end within the next year or two, will likely see their bills rise considerably when they come to the end of their deal.
“The option of moving to a smaller home to achieve lower monthly mortgage payments is starting to become a real consideration for some homeowners. However, before putting a house on the market, it is worth considering that if a flood of properties all hit the market at the same time, this could end up driving house prices down.”
Ethnic minorities and those with disabilities find it harder
Disabled adults were more likely than non-disabled adults to report difficulties with keeping up with energy bills, rent or mortgage payments.
The ONS found that 55 per cent of adults with disabilities said it was hard to afford energy bills, while 36 per cent found rent and mortgage payments difficult. This was compared to 40 per cent and 27 per cent of non-disabled adults respectively.
Further, four per cent of disabled adults said they were behind on their rent or mortgage payments compared to two per cent of non-disabled adults.
Non-white adults are also feeling the strain more, with 28 per cent of white adults finding their rent or mortgage unaffordable while 39 per cent of those from mixed or multiple ethnic groups were struggling.
Almost half (46 per cent) of adults with Asian heritage were finding it hard to keep up with rent or mortgage payments, and black Britons were finding it most difficult with 52 per cent reporting struggles.
Those from ethnic minority backgrounds are also more likely to be behind with rent or mortgage payments, with the highest share of those falling behind being black Britons and those from mixed or multiple ethnic groups at nine per cent apiece.
Some eight per cent of adults with Asian heritage had fallen behind, and two per cent of white adults were failing to keep up with their rent or mortgage.
Londoners finding it harder to pay
Adults in the youngest and oldest age groups were least likely to report being difficulties or being behind on rent or mortgage payments, which the ONS said was possibly due to younger adults not yet being responsible for such payments and older people owning their homes outright.
Those living in London had a higher likelihood of finding rent or mortgage payments hard, with 37 per cent of adults in the capital saying so. People in the North West and London were also likelier to be behind on housing costs with five per cent shares respectively.
People on lower incomes also reported more difficulties with keeping up with bills.
Sarah Coles, senior personal finance analyst at Hargreaves Lansdown, said: “Those on lower incomes are being crushed between rising energy bills and housing costs, including those on pre-payment meters, renters, people with disabilities, Black or Black British people and Asian or Asian British people. And the pressure is only going to get worse.
“Renters are also facing some impossible challenges. They’re finding it harder to pay their energy bills and cover their housing costs than those with mortgages.”
She added: “Renters are also more exposed to rises in living costs. The rapidly falling number of properties available to rent, coupled with escalating numbers of renters means that rents have been soaring in recent months for anyone whose tenancy has come to an end.”
