Becoming debt free to be made harder by rental worries?

At a time when the rise in the cost of living has put the squeeze on many households, it appears those who rent privately could be next in line to suffer more.

A study by Paragon Mortgages recently revealed half of the landlords it interviewed said they plan to raise their rents by four per cent or more.

Money.co.uk has calculated this could mean the average rent will increase by £550 over the course of the year.

As such money might otherwise be used to pay off credit card debt or other borrowing, such extra expense may add to the money worries of many people.

Head of content at Money.co.uk Hannah Maundrell said the cause of the rental increases is the problematic state of the housing market, as many find it hard to get on the property ladder.

She remarked: “The mortgage market has still not really opened up so many people who want to buy have no option but to keep renting. Unfortunately for them, simple supply and demand economics means that this pushes up the cost. ”

Ms Maundrell said those who have tenant contracts should ensure they check them, as this may include clauses barring large hikes in their rent.

The pressure a higher cost of being a tenant may impose on people is just one of the additional costs that could bear down on consumers’ ability to pay off debt this year.

Managing director of personal finance website Moneymaxim.co.uk Mark Bower recently stated that higher utility bills and increased food prices will be among the inflationary problems many face, along with a lack of access to the kind of credit that would enable people to smooth out their bills.

This will make it “more challenging” for people to cope with these pressures, he added.

By James Francis