Inflation hits renters and rural dwellers hard

Poorer and rural households will be hit hardest by rising prices for petrol, household energy and food.

Households who rent their home privately and those who rent from a local authority are also hit harder by inflation than those who own their own home, research from the Central Statistics Office (CSO) found.

Inflation for the year to March was 6.7 percent, the CSO said.

The CSO said that individual households experience inflation differently depending on their spending patterns.

Low earners spend a higher proportion of their income on energy and food.

Statisticians said low-income households had an estimated inflation rate of 7.6 percent in March, compared to an average for all households of 6.7 percent.

Rural households experienced an inflation rate of 7 percent.

Households renting their home had an above-average inflation rate of 7 percent for those renting from a private owner and 7.3 percent for those renting from a local authority.

Households with higher incomes experienced a price increase of 6.1 percent.

Households paying a mortgage had estimated annual inflation below the state average.

But households who own their entire home saw inflation estimated at 7 percent.

Households where the household reference person is under the age of 35 had an estimated inflation rate of 6.6 percent.

If the reference person is 65 or older, annual inflation has been estimated at 7.2 percent.

Above-average inflation was observed in households with one adult, one adult with children, or two adults without children.

Lead statistician Edel Flannery said each household has its own unique pattern of consumption of goods and services and therefore its own personal experience of inflation.

She said the new research paper tries to account for these differences between households.

“Energy costs were a key driver of inflation over the 12 months to March 2022.”

Ms Flannery said transport-related price changes accounted for more than a third of the annual price increase in March.

Increases in electricity, gas and heating oil contributed more than a quarter to the change.

For households in the bottom 10% of income, household energy costs were the largest contributor to their estimated inflation rate.

But for households in the top 10% of incomes, transport was the main contributor to their higher costs.

It comes after the Taoiseach said this week that prices will continue to rise this year and the government has no idea by how much yet.

Micheál Martin gave his harshest assessment yet of ongoing inflation after it hit a nearly 40-year record of 8.2 percent in May.

“Prices will go up. We don’t have exact figures on how much,” Mr Martin said after an EU summit meeting on the second day of talks between leaders on the energy emergency.

The import ban on Russian fuel will lead to higher prices in the wholesale market as countries compete for supplies from other countries, officials concede.

Meanwhile, a poll conducted on behalf of the central bank this week found that a majority of workers believe the real value of their income will fall this year due to inflation.

Most respondents believe average inflation would be 10 percent, but only a third expect their earnings to keep pace with price increases.

https://www.independent.ie/business/personal-finance/inflation-hitting-renters-and-rural-dwellers-hard-41713769.html Inflation hits renters and rural dwellers hard

Fry Electronics Team

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