Household spending on rent and mortgages rose 4.6% year-on-year in May, according to new data from Barclays Property Insights.

The latest figure marked the third month of slowing growth, following a 5.2% increase in April.

Barclays revealed that 29% of mortgage holders plan to refinance in 2025. Of these, 72% expect to pay more, estimating an average increase of £331 in monthly repayments — or nearly £4,000 a year.

Following the Bank of England’s recent rate reduction, over a third of those remortgaging this year (35%) are considering transitioning to a longer fixed rate deal when they remortgage. Others, perhaps expecting further rate cuts in the short-to-medium term, would prefer more flexibility. A quarter (25%) would now consider a standard variable rate and 7% are looking for a tracker mortgage.

Among renters, 44% cited the deposit as a major barrier to homeownership. On average, 22% of those saving are setting aside £254.90 per month.

To meet deposit targets, renters are cutting expenses and boosting income. Over half (51%) are reducing discretionary spending, while 45% are taking fewer holidays. Additionally, 31% have taken on extra work and 40% have launched side hustles.

Only 23% of renters are confident they will own a home during their lifetime, and 18% believe it is achievable within five years. Those with plans to buy expect to do so by age 38 — 10 years later than current homeowners, who bought their first property at age 28, on average.

Concerns over affordability persist, with 58% of renters saying that homeownership would not be possible without family assistance or inheritance.

“Homeowners nearing the end of a five-year fixed rate mortgage are preparing for an increase in their monthly repayments as they transition to higher rates, prompting many to weigh up the certainty of a longer-term fix against the flexibility of a variable or tracker product,” said Jatin Patel, head of mortgages, savings and insurance at Barclays.

“However, the current interest rate environment has not dampened renters’ appetite for getting on the property ladder, many of whom are taking steps to save enough for a housing deposit. For those ready to buy, our data shows that we’re currently in a buyers’ market when it comes to negotiations, with most sellers willing to accept offers under asking in order to facilitate their next move.”

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