31 May 2018 New figures from personal loan provider, Hitachi Personal Finance, have revealed a significant increase in the number of loan applications in motoring, home improvements and leisure over the previous three years.
The lending data shows an increase of 94% in motoring loan applications and 4% in home improvements. Average loan amounts have also seen an increase across the board:
- Motoring: +8.67%
- Leisure: +7.02%
- Home improvements: +1.78%
The insight comes from Hitachi Personal Finance’s new ‘History of Household Expenditure’ analysis, which looks at ONS data from the previous ten years to identify trends in individual and household expenditure, versus income.
The data shows that at the end of 2017, household expenditure was 3.9% higher than the previous year, meaning British residents had gone from spending £533 per week in 2016, to £554 per week in 2017 on their everyday needs, from rent and bills, to food and clothing . This is the biggest increase in the cost of household expenditure in ten years.
Analysis also showed that the individual average weekly expenditure in 2017 was 3.4% higher than 2016’s figures (£226.20 a week compared to £233.80), a difference of £7.60. Again, this is the biggest increase in the past decade.
The UK’s average weekly household expenditure has continually increased since 2014 and has seen a 1.4% overall increase in the last ten years, from spending £230.50 in 2007, to £233.80 in 2017.
However, Hitachi Personal Finance also revealed that average weekly income has remained stagnant, or even decreased, every month since December 2016. What’s more, the average weekly income in March 2008 was at £503, with new figures released this month showing a 2.8% drop to £489 per week.
The categories that have seen the largest increase in expenditure over the previous decade are clothing and footwear, increasing by 27% from £19.80 – £25.10, along with recreation and culture, which has seen a 22% increase from £60.20 – £73.50 per week.
However, the nation hasn’t been splashing the cash in every department, with education (-61%) and alcoholic drinks and tobacco (-30%) seeing a significant drop in expenditure.
The top five growth areas for household expenditure since 2007 are:
- Clothing and footwear – 27% increase
- Recreation and culture – 22% increase
- Communication – 18% increase
- Household Goods and Services – 8% increase
- Miscellaneous goods and services (personal care and products, accessories, childcare products and services) – 2% increase