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The Money Charity released their debt statistics for May 2023. This month the focus has been on the rising interest rates that are being put in place to try and control inflation. Inflation is going down but it is unclear whether the government will meet their target of 2% by the end of the year. Given the interest rate rises, coupled with the high cost of living and the fact that lenders are reigning in on their lending, it seems that the UK could be facing a mortgage affordability crisis.
Snapshot of UK debt May 2023
- Inflation rate is at 8.7%
- There has been another decrease in the price of unleaded petrol during April 2023 by 0.3 pence per litre
- Average credit card debt per household stood at £2,315 in March 2023 which is an increase
- The average total debt per household is £65,513 in March 2023 which has increased since last month
- Total unsecured debt stands at £3,991 per adult in March 2023 which is another increase
- 5% increase in the average first time buyer house price to the year to February 2023
UK Personal Debt
Remember that you can view the statistics from last month here in order to compare with the May 2023 debt statistics.
- The average total debt per household, including mortgages, was £65,513 or £34,588 per adult. This is around 105.3% of average earnings
- 322 people per day were declared bankrupt or insolvent in England and Wales from February to April. This equates to one person every 4 minutes and 28 seconds
- 8.3 properties were repossessed every day in January to March
- 1,076 people a day reported they had become redundant between October and December
- Government debt increased by £642 million per day in the three months to April 2023. This is up from £389 million per day the previous quarter
- The Citizens Advice Bureau dealt with 2,151 debt issues every day in the year to March 2023 which is a steady increase month on month
As well as the impending mortgage affordability crisis – for existing mortgage borrowers as well as those who want to get onto the property ladder – The Money Charity also comments that borrowing is becoming less attractive, yet people are having to turn to credit to meet the cost of affording essentials. This is having a major negative effect on peoples’ financial well-being.
If the past year has had a negative impact on your financial situation, or you are facing increasing debt costs over the next few months, feel free to call us for a discussion on what debt solutions could be available to suit your personal situation.
