The rise in the mortgage payment is a dagger for family finances. So much so that 71% with a loan have had to reduce expenses in other household items as a response and to face the payment, according to the II Cofidis Observatory of Economy and Sustainability in the Home presented this Wednesday.
The unstoppable rise of the Euribor leads another 24% to pull savings to face the increase, 6% are forced to ask for help from family or friends and 4% request a loan from financial institutions. 2% have decided to cut their losses and put the apartment up for sale.
Real estate is just one of the points where the price hit is seen. In general, the rise in inflation has led to cutting expenses in 35% of homes, adjusting the budget to the basics. “The first thing has been to reduce spending on items that are not essential, such as leisure, tourism or household equipment,” explained Anna Golsa, director of digital business and marketing at Cofidis.
They still get out and go on vacation, but 45% have been forced to change their lifestyle and the expenses are much lower. The measure is almost mandatory because in 70% of cases more is used to pay bills, 62% have seen the mortgage increase and 59% spend more on food.
To face the panorama, one can no longer rely on others so easily. “In times of crisis it is common for us to pull family members,” says Golsa. But as expenses increase, there is less room to help. If 32% supported other people in their immediate environment with their income in 2022, the figure is now 21%. Enrique Gómez, director of the study, points out that two factors are combined in the fall. One, that there is not so much margin to support others because the income goes to cover their own. But also that the snip in expenses has left a minimum space for unforeseen events and less help is requested. “In times of uncertainty, households try to contain spending more because of what may happen, which means that they have a greater capacity to face unforeseen events.” Thus, 97% can face an unexpected expense of 100 euros with their income or savings, 90% one of 1,000 euros and 70% one of 5,000. All figures improve on last year.
The situation is in any case fragile. The study, based on 1,664 interviews, reflects that households that cannot save anything at the end of the month rose from 25% last year to 26%. “The increase in prices and mortgages has affected, the war in Ukraine is viewed with concern and the inevitable items have affected other not so basic consumer segments,” Gómez has assessed. This also translates into a worse vision of the future, with 30% expecting that within a year they will be in a worse or much worse situation, almost five points more. Those who expect to continue the same also grow, seven points to 54%.
