Bad news for mortgages revealed in small print of Spring Statement
Sarah Coles, a financial analyst, has identified six financial challenges in the Spring Statement by Chancellor Rachel Reeves. These include:
- Mortgages: Fixed-rate mortgage holders may face rising interest rates, peaking at 4.7% by 2028.
- Inheritance Tax: Bills are expected to rise significantly, with pensions becoming taxable from 2027.
- Income Tax: Frozen thresholds will lead to higher tax bills, with revenue projected to grow substantially by 2027-28.
- Prices: Inflation is forecast to peak mid-year, driven by energy, food, and water costs.
- Wages: Wage growth is expected to slow, with employers gaining flexibility as the labor market weakens.
- Savings: Household savings rates are predicted to decline after 2025 due to rising costs and stagnant wages.
These factors suggest tougher financial conditions ahead.
