House of Commons Library

Household Debt: Key Economic Indicators

Published Tuesday, July 31, 2018

Household debt: Data on the latest household debt statistics, including net lending, mortgage interest rates and insolvencies.

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Household debt as a % of disposable income

Household debt peaked in Q1 2008 at 148% of household disposable income. It then fell until reaching 127% by late 2015.

Starting in early 2016, growth in household debt levels accelerated, leading to the debt-to-income ratio to rise to 134% by mid-2017. It has remained steady since then.

 

Household debt to income ratio

Statistical note: The household debt and income source data were changed in May. Previously debt and income totals included the non-profit sector (mostly charities and universities). The new data reflects only individuals in the household sector. The overall historical trends are unchanged. For more see Box 1 in the Library paper on household debt.

Current average mortgage interest rates

The average Standard Variable Rate (SVR) was 4.06% in June 2018, down by 0.2 percentage points compared to a year ago.

The average 2-year fixed mortgage rate was 1.73% in June, up 0.25%-points from a year ago.  

The increase in fixed-term interest rates in the past year follows the Bank of England raising its base interest rate in November 2017 (from 0.25% to 0.5%) and the possibility of further rate rises this year.

Mortgage interest rates

Individual insolvencies, England and Wales

There were 28,951 individual insolvencies in England and Wales in Q2 2018, up 4% on the previous quarter, and 27% on the same period in 2016. The total number of insolvencies in Q2 2018 was the highest number of individual insolvencies since 2012.

In Scotland, there were 3,208 individual insolvencies in Q2 2018, up 11.8% on a year earlier.

In Northern Ireland, there were 645 individual insolvencies in Q2 2018, an fall of 23% on a year earlier. There were 2,878 individual insolvencies in 2017.

 

Commons Briefing papers SN02885

Author: Chris Rhodes

Topics: Economic situation, Financial services, Incomes and poverty

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