Homeowners and savers are growing increasingly pessimistic about the UK economy and their personal financial prospects, according to the latest survey from the Family Building Society.
The biannual poll of the Society’s members reveals a sharp rise in economic anxiety, with 60% of respondents predicting an economic slowdown in the first half of 2025 – up from just 42% in the Spring survey. By contrast, only 7% believe the economy will experience any growth.
Although many members remain satisfied with their current financial wellbeing, unease about the future is escalating.
Over one-third (35%) expect their financial situation to worsen, marking a significant increase of 21% compared to April. Key drivers of this sentiment include inflation, rising taxes and stagnant incomes.
HOUSING CONCERNS
Housing reform is a recurring theme in the survey, with respondents calling for targeted changes to alleviate the challenges in the property market.
Popular suggestions include abolishing stamp duty for downsizers, raising stamp duty thresholds, and prioritizing development on brownfield sites to increase housing supply.
BUDGET FALLOUT
The October Budget has amplified concerns, with 94% of participants citing its measures as likely to have a negative impact.
Respondents specifically pointed to increased employer National Insurance rates, planned changes to Inheritance Tax and insufficient action to address the cost-of-living crisis.
Survey respondents voiced strong opinions on these issues including “Prices are rising faster than average wage increases.”
“Higher interest rates are squeezing households, with little investment in critical infrastructure” and “Pensioners like me are being penalised” also got strong mentions.
Members also expressed frustration with housing policy, offering pointed suggestions such as “Build on all derelict sites,” “Encourage housing mobility by abolishing Stamp Duty” and “Abolishing Stamp Duty for downsizers would free up larger properties and benefit the market.”
GLIMMERS OF HOPE
Despite the prevailing pessimism, there are small pockets of optimism. A majority of respondents have not needed to provide financial support to family members, and some anticipate further cuts to the Bank of England’s base rate.
However, uncertainty about the housing market continues to weigh heavily on members’ minds.
RISING COSTS AND PRICES
Alistair Nimmo, Director of Marketing at the Family Building Society, says: “The October Budget has clearly left a negative impression on our members, many of whom are concerned about rising business costs leading to higher consumer prices.
“While there are positive signs, such as stability in personal financial support within families, the overall mood remains bleak.
“Members are increasingly unsure about the direction of the housing market and the broader economy, and these sentiments reflect the urgent need for comprehensive and effective policy measures to address these challenges.”
