Wednesday 26 July 2017

Families hit for €3,000 more as price hikes fuel inflation

Charlie Weston Personal Finance Editor

Hard-pressed families are being hit for almost €3,000 more a year as increased mortgage rates and surging energy costs drive inflation higher.

Mortgage interest costs are up 18pc in the past year, gas and liquid fuels are up 20pc and electricity up 11.5pc, according to the latest figures from Central Statistics Office (CSO).

The savage hikes have pushed the annual rate of inflation to a six-month high of 2.8pc last month, compared with increases of 2.6pc in September.

And it means homeowners are paying as much as €3,000 more annually on their mortgage, electricity, gas, home heating oil and petrol costs.

The average family has seen the cost of electricity rise about €150 over a year, with similar rises in gas prices.

Home heating oil has risen by around €150 for a 1,000 litre tank fill since last year -- with many households filling more than once a year.

Statisticians said homes and businesses had seen prices for gas rise by 20pc, electricity prices jumped by 11.5pc and liquid fuels increased by 20pc in the past year.

Mortgage interest costs have shot up by 18pc in the past year. The CSO only measures variable rates when it assesses home loan costs.

It means that a family is paying an extra €200 per month -- or an annual rise of €2,400 -- on a €250,000 mortgage over 30 years, according to calculations by Frank Conway of Irish Mortgage Corporation.

Pressure

Rents were up 13pc in the past year, adding to the pressure on households.

Motorists have been hit in the pocket with a 14.5pc rise in petrol over the last year, and a rise of 14.7pc in diesel.

Bus fares were up 10pc in October compared with a year ago.

The other big riser is fees for third-level education -- which have jumped by 13.4pc in the last year.

Repeated rises in health insurance premiums saw a 24pc rise in this part of the consumer price index.

Motorcycle insurance was up almost 15pc in the past year, but car insurance rose at a more modest 4.2pc.

Home insurance fell by 1.4pc in the past 12 months.

Economists said last night price rises, particularly mortgage rises, were a key concern for households.

In the first 10 months of the year inflation averaged 2.6pc compared with an average fall of 1.3pc last year, economist Alan McQuaid of Bloxham Stockbrokers said.

Irish Independent

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