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 A new financial climate is emerging as a result of rising interest rates and a shift in the property market.
The first signs that the three rate rises which have taken place in 2007 are starting to impact on consumers have emerged in the shape of a welter of new data.
Among the figures are details from price comparison site MoneyExpert.com, which says the base rate of 5.75 per cent – the highest since 2001 – is starting to be felt in consumers' pockets.
With mortgage repayments the biggest single monthly expenditure for most households, the site says it is seeing less and less activity in switches, with the public preparing to feel the pinch.
There are 5.4 million fewer consumers now looking to switch providers on a range of services than January, with more than half of the population – 54 per cent – not switching any of their services in the last six months.
Sean Gardner, chief executive of MoneyExpert.com, said the "financial squeeze caused by higher interest rates" meant consumers are now "more inclined to stick with what they know".
"The reality is that consumers are battening down the hatches in preparation for a rough ride as the mortgage becomes more expensive and disposable income reduces."
Other signs of a tougher financial climate have emerged, conversely, from the picture of broader economic strength being seen at a macro level.
Last week the Office for National Statistics revealed gross domestic product data showed annual growth was at a rate of three per cent, marking the longest run of quarterly increases ever seen according to the government.
With the economy buoyant and the property market slowly responding to rate rises, many experts are predicting further rises – with another quarter percentage hike in August to the psychologically significant barrier of six per cent now on the cards.
Julian King of National Homebuyers says, "With many homeowners responding to rate rises by placing their property on the market and are finding it difficult because of the lack o f buyers.
"Like many experts, we predict further rises. Another quarter percentage hike next month to the psychologically significant barrier of six per cent now a certainty".
National Homebuyers is the UK's leading fast purchase property firm that guarantees to make an offer on any property in the UK, assisting homesellers who desire a quick sale.
"This further rate rise means that the market at the end of the 'property year' will be flooded by homes at over inflated prices with no chance of selling" says King.
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