Number of renters saving for a deposit hits six month low
Rent and mortgage spending sees highest growth since February, with renters disproportionately impacted
- More than half of UK adults believe renting a property is more expensive than paying a mortgage
- 17 per cent of renters report saving for a deposit in July, compared to 31 per cent in January
- Consumer spending on rent and mortgages grew 5.2 per cent in July, the highest increase since February
- Confidence in the UK housing market fell one percentage point to 26 per cent in July
- Barclays Property Insights combines data from across the Bank with consumer research to provide in-depth analysis of UK housing trends
Rent and mortgage spending increased 5.2 per cent year-on-year in July, and spending on utilities was also up by 2.7 per cent, according to Barclays Property Insights data. As costs rise, renters are finding their disposable income disproportionately squeezed compared to their homeowner peers, resulting in a loss of confidence, both in getting on the property ladder, and in the housing market more generally1.
Consumers’ fall in confidence is especially prominent among renters, as the number saving for a deposit has reached a 6-month low (17 per cent in July vs 31 per cent in January). House prices have also overtaken the cost of deposit as the top barrier to homeownership, (38 per cent vs 35 per cent).
Rentflation diminishes aspirations
Nearly two-thirds of renters (62 per cent) have seen, or expect to see their rent increase this year, squeezing their ability to save for a deposit. As a result of cost pressures, only a small proportion (12 per cent) believe that homeownership is within reach within the next year, slightly increasing to 16 per cent who believe it will be possible within five years (19 per cent in June).
Affordability pressures are also limiting choices, as nearly four in 10 (37 per cent) report they are unable to afford to buy a home in the area where they currently rent or would like to live in the future. Costs are also impacting desire to own a home, with three in 10 renters (28 per cent) reporting to be uninterested in homeownership, the highest figure so far this year.
Fewer than a fifth (17 per cent) are actively building a house deposit, the lowest proportion this year, from a high of 31 per cent in January 2025. Some of the most popular ways to save include reducing discretionary spending (14 per cent), cutting back on holidays (11 per cent) or using a side hustle to generate extra income (8 per cent).
Cost advantage for mortgage payers
In the wake of a reduction in interest rates this year, more than half (55 per cent) of all consumers believe renting a property is more expensive than paying a mortgage. This rises to 61 per cent of homeowners, versus 42 per cent of renters, perhaps because owners are more likely to have experienced both circumstances.
Property costs are disproportionately eating into income: housing accounts for almost a third (30.8 per cent) of renters’ take-home pay, whereas homeowners report spending just over a quarter (26.6 per cent) of their earnings on their mortgage. Whilst homeowners will face additional costs such as renovations and certain bills, income levels differ of those surveyed; homeowners are more affluent, with an average reported gross income of £37,775 versus £23,562 for renters.
As a result, a quarter (26 per cent) of renters say they are currently struggling to afford their monthly payments, compared to the one in six (15 per cent) homeowners who feel the same way about their mortgage. Almost half of renters (45 per cent) report adjusting their spending habits to ensure they can continue to afford their housing costs.
Renters save now, borrow later
In order to make their first home as affordable as possible, almost half of those looking to buy (45 per cent) would rather save as much as possible for their deposit, to reduce future mortgage repayments. Conversely, just 12 per cent would consider getting onto the property ladder with a smaller deposit and face higher borrowing costs. This also influences choice of home, with a third (34 per cent) willing to move to a smaller property in order to borrow less.
However, some would put all their capital behind a future home. One in seven (16 per cent) say they would use all their savings in order to get on the ladder, rising to a fifth (20 per cent) amongst millennials.
Jatin Patel, Head of Mortgages, Savings and Insurance at Barclays, said: “Many people dream to one day own a home, but our latest findings highlight how renters are finding it ever harder to save for a deposit while keeping up with rising costs. More positively though, we’re still seeing savers create strong habits, and consider carefully the balance between getting into the market quickly with a lower deposit or trying to minimise monthly repayments in the longer term.
“We’re committed to giving first time buyers the tools they need to get on the property ladder. That’s why we’ve adapted our product range to include new propositions like Mortgage Boost, so that family members can still support first time buyers, even if they don’t have a lump sum that they can gift up front or use with our Family Springboard mortgage.
Will Hobbs, Managing Director, Barclays Private Bank and Wealth Management, said: “The UK economy remains in a better place than the public debate would suggest. Many of these talking heads seem narrowly fixated only on what could go wrong for society, the economy and the future of both, using frequently questionable evidence in support. While there is, as usual, much to worry about, the fact that real (inflation adjusted) household incomes continue to grow briskly remains an important positive, as is the still substantial arsenal of ‘excess’ savings.
“The key to unlocking this pent-up spending power is confidence, a nebulous factor both hard to measure and even harder to forecast. Those trying for a balanced view of the future will remember that in terms of forecasting success, the blind optimists would have trounced the sober pessimists for most of the last few hundred years on the economy both in the UK and globally.”
To understand more about mortgage repayments, or how much you could borrow, try our mortgage calculators here.
Notes to Editors
| Jan | Feb | Mar | Apr | May | Jun | Jul | |
| Percentage growth in spending on rent and mortgages (YoY) | 2.0 | 7.7 | 5.4 | 5.2 | 4.6 | 4.3 | 5.2 |
| Percentage growth in spending on utilities (YoY) | -10.1 | -5.0 | -4.2 | -3.3 | 4.4 | 1.2 | 2.7 |
| Percentage of consumers confident in UK housing market | 24 | 30 | 28 | 29 | 30 | 27 | 26 |
The data in this press release is taken from a number of sources:
Mortgage and rental payments data is sourced from Barclays current accounts – e.g. transactions identified as direct debits and bank transfers to mortgage lenders and private landlords. Please note: the data includes our customers’ payments to multiple lenders (including Barclays). The figures cover the period 24th June 2025 – 18th July 2025 vs 25th June 2024 – 19th July 2025.
Unless otherwise specified, the consumer research in this press release was carried out between 18th July – 22nd July 2025 by Opinium Research on behalf of Barclays. There were 2,000 respondents in each round of research, providing a representative sample of UK consumers by age, gender, region, and income group.
1 Confidence research carried out between 25th July – 29th July 2025 by Opinium Research on behalf of Barclays.
For more information, please contact Annie McQuoid at annie.mcquoid@barclays.com, or +44 7385 535614.
About Barclays
Our vision is to be the UK-centred leader in global finance. We are a diversified bank with comprehensive UK consumer, corporate and wealth and private banking franchises, a leading investment bank and a strong, specialist US consumer bank. Through these five divisions, we are working together for a better financial future for our customers, clients and communities.
For further information about Barclays, please visit our website home.barclays
About Barclays Market and Customer Insights
Barclays Market and Customer Insights helps businesses keep up to date with spending trends, monitors their market position and enhances their understanding of customer behaviour, based on actual customer spending. For further information, please email contact-MCI@barclays.com.
Sophie Hurst
Account Manager
You May Also Enjoy
Property market summer slowdown debunked
Number of renters saving for a deposit hits six month low
80% of first-time buyers moved back in with parents to get on the ladder
Cottagecore dreams on a budget: Zoopla reveals where to find your idyllic and affordable country retreat
Web Design for Estate Agencies: First Impressions Count
