Increasing mortgage costs a source of anxiety for many homeowners

Market analysis by the debt advisory specialists, Sirius Property Finance, has shown that increasing mortgage rates are a source of anxiety for a significant number of UK homeowners, with the ability to afford their monthly mortgage repayment the leading cause of their anxiety.

With the UK currently marking Mental Health Awareness Week and this year’s theme focussing on anxiety, Sirius Property Finance has commissioned a survey of 1,081 UK homeowners to understand how increasing mortgage rates are affecting their mental health, most specifically the levels of anxiety that the increases are inducing.

When asked to rank their level of anxiety in light of recent mortgage rate increases, with 1 meaning no anxiety and 10 meaning maximum anxiety, 20% of people ranked themselves as a full 10 out of 10.

A further 48% of people placed themselves between 5 and 10, suggesting that they are experiencing significant levels of anxiety due to mortgage rate rises.

When asked what is specifically creating their anxiety, 46% said it was the fear of not being able to afford their monthly payments, while 38% said their anxiety was focussed around their low-rate fixed-term mortgage coming to an end.

To try and mitigate their anxiety and prepare themselves for further rate increases, 48% said they have started budgeting more stringently, while 18% have gone so far as to get a second job.

13% said they have extended their mortgage term, while 1% have actually had to sell their home and move into rented accommodation.

Despite these clear and concerning levels of anxiety, it appears that few people are actively seeking help or advice with just 11% having had discussions with their lender or financial advisor about rate increases affecting their ability to afford mortgage payments.

When asked whether or not they have ever before experienced such high anxiety as a result of their mortgage or the wider state of the housing market, 61% said no, they have never experienced anything like this before, regardless of historical economic slumps or personal circumstances.

Managing Director of Sirius Property Finance, Nicholas Christofi, commented:

“With the cost of borrowing having climbed quite significantly since interest rates first started to increase in December 2021, not to mention the fact that many are struggling with the wider cost of living crisis, it’s hardly surprising that it’s a source of anxiety for so many households at present.

It’s really important for homeowners to know that there is help and advice available to them. Even lenders themselves can make payments more affordable for you, but only if you let them know that you’re struggling to keep up.

Don’t be afraid to ask for help if you need it.”