UK Debt: July 2023 statistics

Snapshot of UK debt July 2023

• Inflation rate has decreased from 8.7% to 7.9%
• There has been another decrease in the price of unleaded petrol during June 2023 by 1.1 pence per litre
• Average credit card debt per household stood at £2,350 in May 2023 which is another increase 
• The average total debt per household is £65,529 in May 2023 which is an increase since last month
• Total unsecured debt stands at £4,022 per adult in May 2023 which is another increase
• 1.9% increase in the average first time buyer house price to the year to May 2023 which has decreased again, possibly because of the slowdown of the housing markets given the hike in mortgage rates

UK Personal Debt

Remember that you can view the statistics from last month here in order to compare with the July 2023 debt statistics.

• The average total debt per household, including mortgages, was £65,529 or £34,597 per adult. This is around 103.3% of average earnings
• According to the ONS data from March 2023, household debt is set to rise from £2,333 billion to £2,478 billion in 2025. This would make the average total household debt stand at £86,994
• 298 people per day were declared bankrupt or insolvent in England and Wales from April to June. This equates to one person every 4 minutes and 50 seconds
• 8.3 properties were repossessed every day in January to March, however we are expecting this statistic to decrease given the government’s pledge that repossessions should be delayed by 12 months
• Citizens Advice Bureau dealt with 2,304 debt issues every day in the year to June
• 1,033 people a day reported they had become redundant between February and April
• Government debt increased by £598 million per day in the three months to June 2023

Interest rates still remain high and we are still expecting further hikes next month. These interest rates are having challenging impacts on homeowners, especially if their fixed rate mortgages are due to end soon or they are tracking the base rate. However UK renters are also facing difficulties too and these are the people who are often overlooked in the press when interest rates are mentioned.

With many homeowners facing increases in their mortgage payments, there is now support out there for those finding it difficult to afford those increases. Banks are willing to switch homeowners to interest only mortgages for six months, or extend their mortgage term to reduce their repayments in the short term. Deals can be locked in up to six months ahead and those who are struggling can call their mortgage provider without it impacting upon their credit score. Renters have nothing available to them.

In the last 12 months, UK private rental prices rose by 5.1% with nearly a quarter of private renters falling into the category of being “in serious difficulties”. 36% of social renters are also in that category. Single parent households are more likely to be in difficulty than other types of family units. The statistics highlight some worrying trends, that people are skipping meals in order to save money to pay their mortgage/rent.

The Chief Executive of The Money Charity has stated that “with all lines of people’s expenditure column rising and incomes unable to match them, the UK’s immediate financial outlook is troubling”.

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.