Households could be in for yet another blow following reports that bills could rise by around £6,000 by the end of the year. The average household is expected to pay £6,219 more this December compared to the same month of 2021 as the cost of living crisis continues to grip families, according to the Centre for Economic and Business Research (CEBR).
The main reasons for bills going up are increases in energy bills, food and mortgage costs. CEBR said bills will go up by £4,610 between now and December, The Mirror reports.
The average energy bill could soar by £1,645 within five months to hit £3,616 a year, power experts at Cornwall Insight said last week. And with the Bank of England raising base rates, mortgage costs are rising, too.
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Last week the central bank increased the base rate from 1.25% to 1.75% - a rise of 0.5 percentage points. It is the sixth time in a row that the BoE has hiked interest rates - and marks the largest increase in 27 years.
It also takes UK rates to the highest level since the end of 2008. Base rate rises are passed on to variable-rate mortgages almost instantly, while fixed-rate home loans go up when customers renew.
Around 80% of homeowners have fixed-rate mortgages, with the rest on variable deals. Most fixed-rate deals are for two years.
The cheapest two-year 'fix' is 2.89% a month, which works out at £937 a month over a 25-year term on a £200,000 homeloan. A 0.5% rise to base rate means someone with this mortgage would pay an extra £52 a month - or £624 a year.
That increase is just for the absolute cheapest deal, with many homeowners facing far steeper prices. Grocery costs are also rising, adding pressure for hard-up households.
The price of food has gone up by almost 10% in one year, according to shocking figures that show the pain consumers face at supermarket checkouts. Prices are going up off the back of increased costs for food producers, including energy and fuel.
The war in Ukraine is also pushing up costs, with Russia and Ukraine being key suppliers of wheat and fertiliser.
The food prices going up the most
- Low fat milk - 26.3%
- Butter - 21.5%
- Olive oil - 18.2%
- Sauces, condiments, salt, spices & culinary herbs - 17.1%
- Ready-made meals - 16.7%
- Cooking oils and fats - 16.6%
- Pasta & couscous - 15.9%
- Jams, marmalades & honey - 15.1%
- Poultry - 14.9%
- Margarine & other vegetable fats - 14.6%
- Eggs - 11.5%
- Pork - 9.8%
- Bread - 9.7%
- Potatoes - 9.4%
- Edible ices & ice cream - 8.9%
- Fish - 8.0%
- Fruit - 6.9%
- Breakfast cereals - 6.2%
- Sugar - 5.1%
- Rice - 4.4%
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