Nearly one in three UK homeowners approaching the end of their fixed mortgage deals are taking extra work to boost their savings ahead of repayment rises, new data released by Indeed Flex, the online marketplace for flexible and temporary work, reveals.
Household budgets are increasingly stretched as the UK battles stubborn inflation and rising costs. Increased mortgage rates have not yet filtered through to all households with a mortgage, but will soon add to the financial strain.
With 800,000 fixed-rate mortgage deals set to expire in the latter half of 2023 along with 1.6 million in 2024 and borrowing rates near record highs, households could see their outgoings increase by an average of £220 a month when they renew.
Rather than waiting to see how much their savings will be hit, nearly a third of homeowners (30%) due to remortgage in the next 12 months are already making extra money by doing extra shifts or taking on side hustles, including temporary work to shore up their finances.
Three in ten of those taking on extra work are 25-34. This demographic is typically newer to the housing market, meaning repayment rates are likely to be higher compared with older owner-occupiers.
Roughly a tenth (11%) of those aged between 55 to 64 are pursuing additional employment to cover increased repayment costs.
More than half (54%) of British mortgage-holders are preparing for financial changes in the next 12 months by cutting back on non-essential spending, including takeaways and holidays. Meanwhile, a third (34%) say they are simply spending less and saving more.
Novo Constare, CEO and Co-founder of Indeed Flex, said, “Facing financial realities head-on can be challenging, but ignoring them is likely to prove costly in the long run.
“While those with mortgages expiring this year cannot escape repayment increases, a substantial number are actively seizing control of their finances and trying to get ahead of the increase in their outgoings.
“For those opting to extend their work hours, Indeed Flex provides flexible employment alternatives to help households bolster their savings.
“People can choose the shifts they work based on the hours that suit them best and earn a little extra each week to help them cope with increasing payments.”