New data shows impact of rising costs on renters and homeowners in Lancashire

Rising rent affects social life

Analysis by the Office for National Statistics show an estimated 9% of private renters in Preston, 6% in Chorley, 6% in West Lancashire and 5% in South Ribble were affected by rising rental costs last year.

Of those affected, the average monthly rent increased from £607 before 2023, to £682 last year in Preston, with the increased cost accounting for 26% of Preston renters' household disposable income.

A household’s disposable income is what can be spent on essentials like food and rent as well as on leisure and luxury items such as going shopping or enjoying a meal out.

In Chorley and South Ribble, the average monthly rent increased from £609 to £684 and £627 to £704 respectively, which in both areas accounted for 24% of these renters' household disposable income.

Meanwhile in West Lancashire, the average monthly rent increased from £585 before 2023, to £657 last year, accounting for 23% of these renters' household disposable income.

Home ownership costs have same issue

Nationally, housing costs have also increased since 2022 amid rising inflation and higher interest rates. 

In the year to October 2022, inflation reached a 40-year-high. In response, the Bank of England's Monetary Policy Committee gradually raised the Bank Rate from 0.1% to 5.25% between winter 2021 and summer 2023. 

By the end of 2023, more than a third of those responsible for rent or mortgage payments in Great Britain were struggling to afford them, according to the ONS Opinions and Lifestyle survey. 

The ONS analysis also shows 14% of homeowners in Preston, were remortgaging in 2023, as were 18% in South Ribble, 17% in Chorley and 16% in West Lancashire 

In Preston, the average monthly repayments went up by £138, from £639 before last year to £777 in 2023, meaning overall, the increased cost took up 29% of their household disposable income.

In Chorley, the average monthly repayments went up by £151, from £701 to £852 in 2023.Overall, the increased cost took up 29% of their household disposable income.

West Lancashire then saw the increased cost taking up the largest amount of their household disposable income with the average monthly repayments going up by £175 (from £812 to £987), taking up 35% of their household disposable income.

On the opposite end, South Ribble saw the increased cost taking up the smallest amount of their household disposable income with the average monthly repayments going up by £94 (from £438 to £532), taking up 18% of their household disposable income.

How exposed are rents and homeowners in Lancashire?

The ONS also assigned each area an "exposure score" relative to other local authorities based on the proportion of households affected by rising costs and how much the increased cost took from household disposable income.

Rent in Preston was scored a four out of seven, meaning it was at medium exposure to rising costs, whilst rent in West Lancashire, South Ribble and Chorley were scored a two out of seven, meaning it was at low exposure.

Mortgages in all four areas also had medium exposure, with West Lancashire and Chorley scoring five, South Ribble four and Preston scoring a three.

What do relevant charities say?

StepChange, a charity and debt advice service, said rising housing costs have been a "major driver" of the cost-of-living crisis.

Simon Trevethick, head of communication, said: "Repeated interest rate rises have pushed mortgage payments up for hundreds of thousands of people and rents have risen to record levels both inside and outside of major cities, as private renters especially feel the pinch.

"We want to see the Government supporting households facing increased costs. We have long called for an end to section 21 no fault evictions, as well as a tenancy support scheme ahead of evictions as a last resort."

He added the Mortgage Charter, brought in by the Government last year to help people with sudden increases in mortgage costs, is coming to an end in July. 

"The Government should reassess removing help for mortgage borrowers to ensure there isn’t a cliff edge for those coming off their fixed term deals later in the year," he said.

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What does the government say?

A Government spokesperson said: "Our landmark Renters Reform Bill is progressing through Parliament and will give tenants more security in their homes."

They added a new Private Rented Sector Landlord Ombudsman will be introduced so private tenants can escalate complaints if they are unhappy with the service they receive from their landlord.

"We recognise the cost-of-living pressures tenants are facing, which is why we are providing a £108 billion cost of living support package over 2022-2025 – worth an average £3,800 per household."