AA report reveals cost of running a home has gone up €350 in one year
The research shows mortgage repayments and the cost of energy are the main drivers behind the increase.
The latest report from the AA Home Insurance has revealed the cost of running a home has risen in the last 12 months, with households now needing to spend €16,374.45 a year in order to maintain their home. This is the third successive year that the cost has gone up - with mortgage repayments and energy prices proving the main driver for the €350 increase.
What factors are used to calculate the overall cost?
The AA carries out a study each year to calculate the total cost of owning and maintaining a home in Ireland. Mortgage and property tax are calculated based on the current average property price while all other outlays such as electricity, broadband and the cost of household appliances have been collected and analysed according to October 2017 prices.
Price of energy pushes up overall cost of running a home
Using average usage figures for a three or four bedroom detached house, the calculations for energy outlined in the report highlights the large impact heating our homes has on the overall cost of running them.
The report estimates that €785.90 (up 11.04% percent) will go towards heating a home this year and an additional €1,047.33 (up 11.11 percent) will be spent on electricity.
If you think you might be paying too much for your energy, or haven’t changed supplier in the last 12 months, it’s worthwhile seeing if you can get a cheaper deal on your energy by switching. There are also some helpful energy saving-tips that you can implement around the home to bring the cost of your energy bill down even further.
Switch and save up to €289 on your energy bills
It only takes a few minutes to find a cheaper deal and start saving
Cost of broadband and home phone stays about the same
Thankfully for broadband users, the research has shown that the cost of broadband and home phone has stayed much the same in 2018 as it did the previous year. It’s calculated that the average household will pay around €434.62 in 2018 to keep their home connected. With plenty of competitive deals on the market for home broadband and phone plans, there is more choice than ever - and consumers have the freedom to choose a plan that is best suited to their needs whilst also saving money at the same time.
Other factors to be mindful of..
The rise in the national average asking price of a second hand home in Ireland has only helped increase the cost of running a home, with values rising from €224,500 during the third quarter of last year to €243,000 in the third quarter of 2018. Unfortunately, those who took out a 90 percent mortgage this year are likely to pay 1.86% more which equates to approximately €10,069.08 per annum. General wear and tear of the home also makes up a large proportion of the overall cost with €1,255.56 to be spent or put aside each year to cover such repairs and maintenance.
However, it isn’t all bad news with the cost of property tax and TV licensing staying relatively stagnant when compared the the previous 12 months.
“Another year of rising household costs is the last thing that homeowners would have wanted to hear but it is, unfortunately, the situation that we find ourselves in.”
Speaking on the latest report findings Conor Faughnan, AA Director of Consumer Affairs said: “Home heating and electricity costs have surged in the past year meaning that even those who were fortunate enough to acquire their home when property prices were a little lower have seen their wallets take a significant hit.
“Overall, the percentage of the average national wage which must be put aside to cover these costs has dropped slightly, albeit by approximately one percent, many homeowners will be concerned to see the cost of most of their household bills increasing.”