Why renters are more vulnerable to interest rate rises than mortgage holders

Published

2 years ago

August 2, 2023

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Mortgage payers are now in the minority in the UK.

Data from the census reveals that there are more people renting, and more people owning their homes outright, than there are people still paying off their mortgage.

Within the EU just three countries – Germany, Austria and Denmark – have more renters as a share of their population than there are in the UK.

Interest rates have risen from 0.1% to 5% in the last 18 months, and a Bank of England announcement on Thursday is expected to see rates rise higher still.

Many mortgage payers – those paying variable rates or whose fixed deals have expired – have either been hit with significant rises to their monthly payments or been forced to extend terms, meaning they are paying off the loan more slowly.

And there’s more pain still to come, sharply perhaps in coming months – there was a big spike of mortgages arranged before the pandemic-era stamp duty holiday ended – any of those deals that had a two-year fix will be coming to a close around now.

But it’s not just mortgage payers who are exposed to those rises, renters are vulnerable too.

And they are typically in a worse place to start off with, spending more of their income on housing costs as a percentage – 33% on average (42% in London), compared with 22% for mortgage payers.

They are also more likely to live in non-decent standard homes, have lower savings, and lower incomes overall.

What’s happening with renters?

Research by Zoopla estimates that around 60% of rented properties are mortgaged, with most of those on interest only mortgages, meaning they are particularly exposed to rate changes.

For the two in five Britons who are renters, a rise in monthly repayments is nothing new. Many landlords raise rent each year, to keep up with inflation or market demand, even when mortgage repayments were staying relatively low.

Now however, those landlords whose repayments are going up could be forced to raise rents by more to ensure they aren’t losing money month on month.

That’s what happened to Andi Michalakis, a 51-year-old in Stevenage who lives in a three-bed house, currently surrounded by boxes containing her belongings, along with her 14-year-old son.

Andi says her landlord doesn’t have a job, but lets out multiple properties that he owns and has a mortgage on the one she’s been living in for the past nine years.

Through the time she’s been there her rent has typically risen by a manageable £25 a month each year. Andi explains that she would carry out maintenance like painting, fixing taps and work in the garden out of her own pocket rather than at the expense of the landlord. She has never missed a rent payment.

During the pandemic there was no change to her rent, but at the beginning of 2022 it went up by £75 a month, to £1,200. Less than a year later her landlord asked for £1,300, which was too much to afford – particularly as Andi’s work-life and health had changed during the pandemic.

Andi had to stop working for a time due to illness, and her work in the fashion industry was affected by lockdown, meaning that £100 extra her landlord was asking for represented almost half of all that she had left after paying the rent.

Andi’s family had already been helping out with shopping – her sister would bring food while her brother would come through with toiletries and other essentials.

She spoke to the council to explore her options in resisting the further £100 increase – they told her that the landlord was now asking for £1,425 instead – a 19% increase on the £1,200 she was paying before.

Soon after, he issued a Section 21 “no fault” eviction notice, starting the process of removing Andi from the place she had made her home for the past decade.

Sky News tried to contact Andi’s landlord, via the estate agent and through the council, but he was unavailable to comment. The estate agent said they would not have asked for a rent increase as high as £225, because it was too much of a jump in one hit.

More than 30,000 people have reached out to homelessness prevention support after being issued Section 21 notices since the start of January 2022, with the number rising more recently. Many people, like Andi, can’t pass affordability tests on new rentals after being evicted, despite perfect records of paying rent on time historically.

Avoiding homelessness

Andi’s biggest fear at the moment is that she ends up homeless, in inappropriate temporary accommodation, potentially sharing a room with her teenage son, and is forced to stay there for years until she gets to the top of the priority list for housing.

She has been warned that temporary accommodation may not even be in Stevenage where her son goes to school.

“He’s a teenage boy, he needs his own space to do the things he likes. I’ve heard of cases of people stuck like that for years. Who wants to be locked in one room like that with their mother?”

Jasmine Basran, Head of Policy and Campaigns at homeless charity Crisis, told Sky News that competition in the private rental sector is making things particularly difficult for those worst off.

“With what’s happening with mortgages, everyone’s turning to the private rented sector and therefore, landlords have choice.

“Often it’s people on the lowest incomes who get turned away from properties because a landlord can find someone else who’s willing to let the property who they feel is more secure or who can cover a higher cost of rent.”

Mortgage holders

Although mortgage holders are being squeezed at the moment, they are in a comparatively comfortable spot. The majority will have equity in the house or other savings to fall back on, and higher average earnings in general.

Depending on how far along you are with repaying your mortgage, servicing the interest may be a relatively small contribution. The rate that fully owned properties have been increasing recently suggests that there will be large groups more people with small amounts left to pay, who will become full owners in the coming years.

Mortgage holders are also empowered to negotiate lower monthly repayments with banks who have committed to support them and find solutions that avoid repossessions, in a way that renters often can’t with their landlords.

UK Finance, a banking and finance research group, estimates that around 7,000 mortgage holders will have their homes repossessed this year, far fewer than that number seeking homelessness support after being served Section 21 notices. After the 2008 financial crash 40,000 homes were repossessed.

James Tatch, Head of Analytics at UK Finance, said: “Mortgage holders came into this in a really strong place in general, because mortgage arrears are at historic lows. That’s thanks partly to the ultra-low rates we’ve had in recent years, as well as more responsible lending, and the savings many households built up during COVID.

“In that situation, lenders will work with every borrower to work out the best solution to their specific situation. That might be a reduction of the mortgage for a certain amount of time, or a change to paying interest only.”

Competition in the rental market

One of the reasons that evictions from private rental can lead towards homelessness is the competition in the rental market.

“We are starting to see a big increase in people needing help and ending up in temporary accommodation because there’s nowhere else for them to go,” said Ms Barsan.

There are five people competing over every room advertised in house and flat shares on SpareRoom, while Rightmove report a 42% increase in demand for rental properties from 2019 to 2023.

This squeeze has been driven by both an increase in renters seeking rooms as well as a reduction in the number of rooms available, with data from SpareRoom showing an additional 69,000 renters competing over 27,000 fewer rooms compared to 2017.

Some areas in England have experienced faster rent increases than others – a small handful have even seen reductions. The map below shows change in rents by area, for the lower end of the market (the cheapest 25%) and for the middle of the market (average rents).

In Middlesbrough, those cheaper rents have increased by 15.4%, from £390 to £450. That would have been the middle of the market last year, now it’s among the cheapest you can find.

Rents for newly advertised properties have increased even faster than for those in existing tenancies, perhaps explaining a motivation for landlords to remove long-standing tenants.

The average price of rental properties advertised on Rightmove in the UK increased by 10.2%, from £1,283 to £1,413 in the year to June. Prices for rooms in house and flat shares advertised on SpareRoom are 14.5% higher than a year ago across the UK on average, up from £678 to £776 a month in July this year.

Social housing

The current waiting list for social housing stands at 1.2 million. With sell-offs and demolitions, many local authorities end up with a net loss of social housing year-on-year, despite a rising population.

Because of this lack of capacity, the most vulnerable homeless households are prioritised for social housing, while others are moved into temporary accommodation.

Despite being disabled and having a teenage child, Andi is in priority Band D, the fourth lowest. Those in Band A are often seeking refuge from domestic violence, for example.

This means she often misses out on offers of suitable housing and is left with options she has to decline because of her mobility issues.

The number of households living in temporary accommodation now stands at its highest since records began in 1998.

What can be done to solve the housing crisis?

Crisis say that there are things that the government can do right now to ease the housing crisis.

“The other side of temporary accommodation, apart from the very human cost of what people are having to go through by living there, is that it has a phenomenal financial cost to local authorities,” says Ms Basran.

Councils spent at least £1.6 billion on temporary accommodation in the latest year, according to the government’s own analysis.

“That’s a huge amount of money to manage people in homelessness. And that money could be used to support people into long term housing, if we had a clear plan of delivery, and unfreeze housing benefit so that more properties are affordable to people.”

A spokesperson from the Department for Levelling up, Housing and Communities said: “Our landmark Renters (Reform) Bill will deliver a fairer deal for both renters and landlords. We are abolishing section 21 ‘no fault’ evictions to give tenants greater security in their homes.

“We are also improving availability of social housing. Our Levelling Up White Paper committed to increasing the supply of social rented homes, and many of the new homes delivered through our Affordable Homes Programme will be for social rent.

“We are on track to deliver 1 million new homes in this parliament, and we are investing £11.5 billion to build more of the affordable, quality homes this country needs.”

The Data and Forensics team is a multi-skilled unit dedicated to providing transparent journalism from Sky News. We gather, analyse and visualise data to tell data-driven stories. We combine traditional reporting skills with advanced analysis of satellite images, social media and other open source information. Through multimedia storytelling we aim to better explain the world while also showing how our journalism is done.

UK

Who was at the Pope’s funeral – and who wasn’t

Published

27 mins ago

April 26, 2025

admin

Who was at the Pope's funeral - and who wasn't

The Pope’s funeral is taking place today at St Peter’s Basilica at the Vatican.

A pope’s funeral traditionally brings world leaders together, and several were in attendance.

Watch full coverage of the Pope’s funeral live on Sky News from 8am

Here’s a look at the list.

Prince William

The Prince of Wales attended the funeral of Pope Francis on behalf of the King.

The King was in Rome with Queen Camilla earlier this month, and met the pontiff at the Vatican.

The trip came just a week-and-a-half after Buckingham Palace confirmed the King had been taken to hospital following side effects related to his ongoing cancer treatment.

Sir Keir Starmer

Number 10 confirmed the prime minister received an invite and so he attended the ceremony.

Speaking on Tuesday, Sir Keir said there had been “an outpouring of grief and love” for the Pope.

He added: “I think it reflects the high esteem in which he was held, not just by millions and millions of Catholics, but by many others, across the world, myself included.”

Donald Trump

The US president was one of the first to confirm he would be flying to Rome, adding he would be joined by first lady Melania Trump.

Writing on his social media platform Truth Social on Monday, he said: “Melania and I will be going to the funeral of Pope Francis, in Rome. We look forward to being there!”

The Pope had been critical of Mr Trump at times during his tenure.

In January, he said it would be a “disgrace” if the president went ahead with his crackdown on immigration, telling an Italian television station: “It would make the migrants, who have nothing, pay the unpaid bill.

“It doesn’t work. You don’t resolve problems this way.”

Volodymyr Zelenskyy

The Ukrainian president, who met the Pope three times, was also in attendance – and there was an outbreak of applause for him when he arrived.

Mr Zelenskyy has said his country is grieving the Pope and recalled how he often prayed for peace in Ukraine.

Emmanuel Macron

The French President Emmanuel Macron also attended the funeral with his wife Brigitte.

In his tribute on Monday, Mr Macron said of the Pope: “In this time of war and brutality, he had a sense for the other, for the most fragile.”

Giorgia Meloni

The Italian premier, along Argentine leader Javier Milei (below) had place of pride in the seating order for the service.

The Vatican is, of course, surrounded by the Italian capital Rome, while the Pope was born and grew up in Argentina and was once Archbishop of Buenos Aires.

Javier Milei

The president of Pope Francis’s native Argentina was also at the ceremony, despite having launched insults at Francis in recent years.

Before taking office in December 2023, the far-right politician called him “an imbecile, the representative of evil on Earth”.

Mr Milei alluded to their “differences” in his tribute to the late Pope, writing: “It is with profound sorrow that I learned this sad morning that Pope Francis, Jorge Bergoglio, passed away today and is now resting in peace.

“Despite differences that seem minor today, having been able to know him in his goodness and wisdom was a true honour for me.”

Joe Biden

Former US president Joe Biden, 82, was at the funeral with his wife Jill. The couple were seen taking their places in the bright sunshine prior to the service.

Mr Biden appeared to be getting some help to his seat, taking the arm of a member of the church.

Lula da Silva

The Brazilian president and first lady Janja Lula da Silva were also at the funeral.

Brazil had also declared a seven-day mourning period for the Pope.

“Humanity is today losing a voice of respect and welcome for others,” the president said in his tribute.

“Pope Francis lived and propagated in his daily life the love, tolerance and solidarity that are the basis of Christian
teachings.”

Ursula von der Leyen

The EU Commission President confirmed she was attending after calling Francis a worldwide inspiration.

“He inspired millions, far beyond the Catholic Church, with his humility and love so pure for the less fortunate,” she said in her tribute.

Council President Antonio Costa, Parliament President Roberta Metsola was also expected to be in attendance.

Here are some of the other notable attendees:

• Ireland’s taoiseach Micheal Martin
• Spain’s King Felipe and Queen Letizia
• Albanian president Bajram Begaj
• Angola’s president Joao Lourenco
• Austrian president Alexander Van der Bellen
• Bangladesh’s chief adviser and interim leader Muhammad Yunus
• Belgium’s King Philippe and Queen Mathilde, along with prime minister Bart De Wever
• Canada’s governor general Mary Simon
• Cape Verde president Jose Maria Neves
• Croatia’s president Zoran Milanovic
• Cyprian president Nikos Christodoulides
• Czech Republic’s prime minister Petr Fiala
• Democratic Republic of Congo president Felix Tshisekedi
• Dominican Republic’s president Luis Abinader
• East Timor’s president Jose Ramos-Horta
• Ecuador’s president Daniel Noboa
• Estonia’s president Alar Karis
• Finland’s president Alexander Stubb
• Gabon’s president Brice Oligui Nguema
• German president Frank-Walter Steinmeier and outgoing chancellor Olaf Scholz
• Greece’s prime minister Kyriakos Mitsotakis
• Honduras president Xiomara Castro
• Hungary’s president Tamas Sulyok
• Italy’s president Sergio Mattarella and prime minister Giorgia Meloni
• Latvian president Edgars Rinkevics
• Lithuanian president Gitanas Nauseda
• Moldova’s president Maia Sandu
• Netherlands’ prime minister Dick Schoof
• New Zealand’s prime minister Christopher Luxon
• Norway’s Crown Prince Haakon and Crown Princess Mette-Marit
• The Philippines’ president Ferdinand Marcos Jr
• Poland’s president Andrzej Duda
• Portugal’s president Marcelo Rebelo de Sousa and prime minister Luis Montenegro
• Romania’s interim president Ilie Bolojan
• Sweden’s King Carl XVI Gustaf, Queen Silvia and prime minister Ulf Kristersson
• Switzerland’s president Karin Keller-Sutter

Who was not there?

Vladimir Putin

The Russian president did not attend the funeral.

But the controversial leader paid tribute to the Pope, writing a message to Cardinal Kevin Farrell, who is interim chief of the Catholic Church.

“Please accept my most sincere condolences on the passing of His Holiness Pope Francis,” Mr Putin said.

“Throughout the years of his pontificate, he actively promoted the development of dialogue between the Russian
Orthodox and Roman Catholic churches, as well as constructive cooperation between Russia and the Holy See.”

Benjamin Netanyahu

Israeli Prime Minister Benjamin Netanyahu also did not attend the ceremony, with the country’s ambassador Yaron Sideman going instead.

The Jewish state and the Vatican have had strong relations in the past, with Israel sending a presidential delegation to the funeral of Pope John Paul II in 2005, and Pope Francis visiting Israel in 2014.

But their relationship has deteriorated since the start of the war in Gaza.

A month after the conflict started in 2023, a dispute broke out over whether Pope Francis had used the word “genocide” to describe events in Gaza. Palestinians who met with him said he did, but the Vatican said he did not.

The Pope met relatives of Israeli hostages on the same day.

Israeli officials have since lobbied the Vatican to be more forceful in its condemnation of Hamas.

In January, the Pope called the humanitarian situation in Gaza “shameful”, prompting criticism from Rome’s chief rabbi, Riccardo Di Segni, who accused Francis of “selective indignation”.

Rabbi Di Segni said he would be attending the funeral, despite it taking place on the Jewish sabbath.

Was there a seating plan?

The seats were assigned in advance, with the heads of state sitting in French alphabetical order based on their country’s name, rather than on the individual’s.

This applied to everyone apart from the presidents of Italy and Argentina, who got the best seats because the Pope lived in Italy and was an Argentinian native.

UK

Virginia Giuffre, who accused Prince Andrew of sexual assault, has died, her family says

Published

6 hours ago

April 26, 2025

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Virginia Giuffre, who accused Prince Andrew of sexual assault, has died, her family says

Virginia Giuffre, who accused Prince Andrew of sexual assault, has died aged 41.

In a statement to Sky’s US partner network NBC News on Friday, her family said she took her own life in the Perth suburb of Neergabby, Australia, where she had been living for several years.

“It is with utterly broken hearts that we announce that Virginia passed away last night at her farm in Western Australia,” her family said.

“She lost her life to suicide, after being a lifelong victim of sexual abuse and sex trafficking.

“Virginia was a fierce warrior in the fight against sexual abuse and sex trafficking. She was the light that lifted so many survivors.

“In the end, the toll of abuse is so heavy that it became unbearable for Virginia to handle its weight.”

Police said emergency services received reports of an unresponsive woman at a property in Neergabby on Friday night.

“Police and St John Western Australia attended and provided emergency first aid. Sadly, the 41-year-old woman was declared deceased at the scene,” a police spokeswoman said.

“The death is being investigated by Major Crime detectives; early indication is the death is not suspicious.”

Sexual assault claims

Ms Giuffre sued the Duke of York for sexual abuse in August 2021, saying Andrew had sex with her when she was 17 and had been trafficked by his friend, the billionaire paedophile Jeffrey Epstein.

The duke has repeatedly denied the claims, and he has not been charged with any criminal offences.

In March 2022, it was announced Ms Giuffre and Andrew had reached an out-of-court settlement – believed to include a “substantial donation to Ms Giuffre’s charity in support of victims’ rights”.

She stuck by her version of events until the end

Of the many dozens of victims of Jeffrey Epstein, it was Virginia Giuffre who became the most high-profile.

She was among the loudest and most compelling voices, urging criminal charges to be brought against Epstein, waving her right to anonymity in 2015.

She told how he and Ghislaine Maxwell groomed her and “passed around like a platter of fruit” to be used by rich and powerful men.

But her name and face became known around the world after she accused Prince Andrew of sexually abusing her when she was 17 years old.

The picture of her together with the prince and Maxwell at the top of a staircase, his hand around her waist, is the defining image of the whole scandal.

Prince Andrew said he had no memory of the occasion. But Giuffre stuck by her version of events until the end.

‘An incredible champion’

Sigrid McCawley, Ms Giuffre’s attorney, said in a statement that she “was much more than a client to me; she was a dear friend and an incredible champion for other victims”.

“Her courage pushed me to fight harder, and her strength was awe-inspiring,” she said. “The world has lost an amazing human being today.”

“Rest in peace, my sweet angel,” she added.

Dini von Mueffling, Ms Giuffre’s representative, also said that “Virginia was one of the most extraordinary human beings I have ever had the honour to know”.

“Deeply loving, wise, and funny, she was a beacon to other survivors and victims,” she added. “She adored her children and many animals.

“She was always more concerned with me than with herself. I will miss her beyond words.

“It was the privilege of a lifetime to represent her.”

Ms Giuffre said at the end of March she had four days to live after a car accident, posting on social media that “I’ve gone into kidney renal failure”. She was discharged from hospital eight days later.

Raised mainly in Florida, she said she was abused by a family friend early in life, which led to her living on the streets at times as a teenager.

She said that in 2000, she met Ghislaine Maxwell, a British socialite who was convicted in 2021 on federal sex trafficking and conspiracy charges and was sentenced to 20 years in prison.

Ms Giuffre said Maxwell then introduced her to Epstein and hired her as his masseuse, and said she was sex trafficked and sexually abused by him and associates around the world.

‘A survivor’

After meeting her husband in 2002, while taking massage training in Thailand at what she said was Epstein’s behest, she moved to Australia and had a family.

She founded the sex trafficking victims’ advocacy charity SOAR in 2015, and is quoted on its website as saying: “I do this for victims everywhere.

“I am no longer the young and vulnerable girl who could be bullied. I am now a survivor, and nobody can ever take that away from me.”

:: Anyone feeling emotionally distressed or suicidal can call Samaritans for help on 116 123 or email jo@samaritans.org in the UK. In the US, call the Samaritans branch in your area or 1 (800) 273-TALK.

UK

Who will be at the Pope’s funeral – and who won’t be

Published

6 hours ago

April 26, 2025

admin

Who will be at the Pope's funeral - and who won't be

The Pope’s funeral will take place today at St Peter’s Basilica at the Vatican.

A pope’s funeral traditionally brings world leaders together, and some have already revealed they are attending.

Watch full coverage of the Pope’s funeral live on Sky News from 8am

Here’s a look at the list.

Prince William

The Prince of Wales will attend the funeral of Pope Francis on behalf of the King, Kensington Palace has said.

The King was in Rome with Queen Camilla earlier this month, and met the pontiff at the Vatican.

The trip came just a week-and-a-half after Buckingham Palace confirmed the King had been taken to hospital following side effects related to his ongoing cancer treatment.

Sir Keir Starmer

Number 10 has confirmed the prime minister received an invite and will attend the ceremony.

Speaking on Tuesday, Sir Keir said there had been “an outpouring of grief and love” for the Pope.

He added: “I think it reflects the high esteem in which he was held, not just by millions and millions of Catholics, but by many others, across the world, myself included.”

Donald Trump

The US president was one of the first to confirm he would be flying to Rome, adding he would be joined by first lady Melania Trump.

Writing on his social media platform Truth Social on Monday, he said: “Melania and I will be going to the funeral of Pope Francis, in Rome. We look forward to being there!”

The Pope had been critical of Mr Trump at times during his tenure.

“It doesn’t work. You don’t resolve problems this way.”

Volodymyr Zelenskyy

The Ukrainian president, who met the Pope three times, is expected to attend, according to officials in Ukraine.

In his tribute, Mr Zelenskyy said his country was grieving the Pope and recalled how he often prayed for peace in Ukraine.

Emmanuel Macron

The French president told local reporters he would be going to the funeral.

In his tribute on Monday, Mr Macron said of the Pope: “In this time of war and brutality, he had a sense for the other, for the most fragile.”

Javier Milei

The president of Pope Francis’s native Argentina will attend, despite having launched insults at Francis in recent years.

Before taking office in December 2023, the far-right politician called him “an imbecile, the representative of evil on Earth”.

“Despite differences that seem minor today, having been able to know him in his goodness and wisdom was a true honour for me.”

Lula da Silva

The Brazilian president and first lady Janja Lula da Silva will be at the funeral, the country’s government announced.

Brazil has also declared a seven-day mourning period for the Pope.

“Humanity is today losing a voice of respect and welcome for others,” the president said in his tribute.

“Pope Francis lived and propagated in his daily life the love, tolerance and solidarity that are the basis of Christian
teachings.”

Ursula von der Leyen

The EU Commission President confirmed she would be attending after calling Francis a worldwide inspiration.

“He inspired millions, far beyond the Catholic Church, with his humility and love so pure for the less fortunate,” she said in her tribute.

Council President Antonio Costa, Parliament President Roberta Metsola are also expected to attend.

Here are some of the other notable attendees:

Who won’t be there?

Vladimir Putin

The Russian president will not be attending the funeral, the Kremlin has confirmed.

But the controversial leader paid tribute to the Pope, writing a message to Cardinal Kevin Farrell, who is interim chief of the Catholic Church.

“Please accept my most sincere condolences on the passing of His Holiness Pope Francis,” Mr Putin said.

Benjamin Netanyahu

The Israeli prime minister is not expected to attend, with the country’s ambassador Yaron Sideman going instead.

But their relationship has deteriorated since the start of the war in Gaza.

The Pope met relatives of Israeli hostages on the same day.

Israeli officials have since lobbied the Vatican to be more forceful in its condemnation of Hamas.

In January, the Pope called the humanitarian situation in Gaza “shameful”, prompting criticism from Rome’s chief rabbi, Riccardo Di Segni, who accused Francis of “selective indignation”.

Rabbi Di Segni says he will be attending the funeral, despite it taking place on the Jewish sabbath.

Is there a seating plan?

The seats are assigned in advance, with the heads of state sitting in French alphabetical order based on their country’s name, rather than on the individual’s.

This applies to everyone apart from the presidents of Italy and Argentina, who get the best seats because the Pope lived in Italy and was an Argentinian native.