To think a recession is looming?

[GrannyBloomers]

I was quoted £2 a litre for heating oil. £1000 for 500 litres, a matter of weeks ago it was roughly a quarter of the price.

Energy bills set to be £3k per annum - potentially more when a new price cap comes in in October.

Diesel near me is 171p and rising.

I'm in a 3 bed semi, nothing special. I need at least 1500 litres of oil a year (it runs the hot water too). That's say £3k. No gas but electric. I'm doing ok with cutting use = £1.5k per annum.

That's 4.5k at todays prices for household power. What will it be in October - 6k, 9k more?

This is before other costs increase - food will go up when the cost of storing it (refridgeration etc uses energy) and transport also increase.

If all the average person's income is spent on rent/mortgage/ bills and energy, then there's no money to spend on anything else. No eating out, no leisure, no holidays.

Surely a huge recession will follow.

And what if a much higher proportion of people need benefits?

Interesting what people are saying re builders and work.

DM has a distant cousin staying with her whilst he's renovating and then letting his town house in nearby city as old tenants recently moved out.

The old builders ruined/flooded his tiled floor and although new tenants could move in and live with it, he'd like to get the flooring issue sorted out now rather than in the future.

DM found a trader who can do both structural and tiling work and apparently they can start soon, in a week. Very good worker and recommended. This is good news to cousin but obviously means people are cutting back on building etc work.

Yes I've been thinking along the same lines. To account for rising fuel costs we will be eating out less and taking fewer little trips away - and how fortunate we are to have that choice.
Things have felt genuinely optimistic, with the Covid measures coming to and end and the UK economy starting to get back into decent shape. All of that money sloshing around last year - it was Jacuzzis and new kitchens galore where we live.
I can't believe how grim the picture looks just a few months later.

Yep! Time to batton down the hatches. For about the next 5 years I reakon

DM bought a BTL with stepdad a few years ago and luckily this means the profit from this she either saves for herself or uses to help DB and SIL. DB is self employed in film/TV but wants to get out of it (long hours, weekend work).

We've all noticed fuel etc bills. As I've said on another thread I'm prepared to rent out a spare room, if need be to increase income, luckily I've got another double and box room.

But my friend who lives in a 1 bedroom flat is really struggling, single woman. She has to commute to the office (hybrid working) but really wants to sell her flat and move to a place where housing is cheaper. She's luckily paid off her mortgage but says bills and food etc have risen so much.

@ImplementingTheDennisSystem

Yes I've been thinking along the same lines. To account for rising fuel costs we will be eating out less and taking fewer little trips away - and how fortunate we are to have that choice. Things have felt genuinely optimistic, with the Covid measures coming to and end and the UK economy starting to get back into decent shape. All of that money sloshing around last year - it was Jacuzzis and new kitchens galore where we live. I can't believe how grim the picture looks just a few months later.

@ImplementingTheDennisSystem - agreed with you.

I know of one friend who works part time as practice nurse/hairdresser and her DH is a builder. I think they're doing ok but they rent and would love to buy. They're luckily sensible with money but love foreign holidays and got a hot tub last year.

Another friend is a TA in a school and was widowed during Covid, luckily her children are at college but she's panicking about rising costs as she has to drive to work. Could get a bus but prefers to drive.

I don't know where they expect people to magic up extra money to live from!

Me and DP are moderate earners, we are just past the cut off point for benefits, so not on the breadline but not living with luxuries either.

Our rent is high and with everything else going up i dont know how we will cope. We have some debt due to redundancies a couple of years ago, trying so hard to pay it back but we just rob Peter to pay Paul. Even without the debt we still wouldnt have loads left over.

We are just going to have to cut down ever more and use the car sparingly, its so fucking grim, going to work everyday just to pay bills.

Yes I think one is looming. I had my money on a couple of years, but covid and now Ukraine sadly, are speeding it up. It’s inevitable. I have 3 dc in their 20’s, I feel it’s going to be very hard for them.

@stripeyflowers

I think we need to face up it: we are going to endure the worse times have ever experienced in any of our lifetimes. Life will be immeasurably and inconceivably different from now on in. The year 2019 was our last and best year. There is no return to a preferred normal. Realism.

Wow how depressing!! But possibly realistic? Will this be worse than 08-09? Now that China are getting involved in the conflict in Ukraine perhaps (being optimistic) things may get resolved?

Yes I think there’s one looming. I’m not sure if it’s the news about Ukraine or a combination of that as well as rising costs but my town centre has been very quite the last week, I was in Manchester yesterday for a day out and the shops felt much quieter than usual too. It could just be a coincidence but to me it feels like people are being cautious.

Don't forget the tax rises too. NIC rising from April, and of course, the "stealth" tax rises of personal allowances/thresholds etc not rising with inflation.

It will be blamed on Labour somehow in the future.

Yes I think so. The price of oil will put the price of everything we buy up. And even those like me who can afford to pay for rising energy costs will be cutting back on what we buy because we just don't know what is round the corner e.g. unemployment.

@Lockheart

House prices are still going through the roof too.

Something will have to give, but I hope we'll avoid a full recession.

I was about to type much the same In particular the crazy house prices drive me mad; as a recipe for widespread negative equity it's hard to beat

Probably is. Hopefully not, but it's looking more and more likely. Not many will care though, certainly not the politicians. I'm hoping to keep wfh so that I use my car less and that my partner gets a better paying job soon so that we are safer money wise.

@Allelbowsandtoes that might be the only good thing to come from the cost of diesel going so high. I trained in Dublin. My manager drove to work, it was quicker for her to take the luas (tram) because like most big cities traffic is brutal. I asked her why, she said, I get a parking space! I was also chatting to a partner in another firm, who said he drove, even though he lived right on the dart line, because, 'it was easier'. He lived a 2 min walk to the train, his nearest station was then about 2 mins into the office, dart took 20min. It used to take him up to an hour to drive into work!

Unfortunately now public transport is not an option for me, like many people. I live 5 miles from the closest town where the bus comes once a day and goes to very random places. But we will use the car less.

I think a recession is certainly coming. Last year I wasn't rich but I felt comfortable. With increasing prices I think those extra comforts/ bit of savings will be soaked up with increased living costs.

As an accountant in the industry I work in, I would be worried that would dry up and I know I would be the first out of the office (nothing malicious). DH is a farmer though and people will still need to eat but I am seriously worried about the crazy increases in the cost of running the farm. Diesel/ fertiliser has been a mad price since before Christmas.

The last recession in UK was 2008/2009 wasn't it?

I recall I temped on contracts then for 2008-2010 and then in June 2010 got a permanent job. During that time period I also retrained as a legal secretary. I was lucky as I rented out my spare rooms then but also I had a good friend who worked as a recruitment consultant so got me a lot of work but other friends struggled.

I think a nasty dose of stagflation seems inevitable.

Yes. Have a look at stagflation.

Covid cost billions and things were bad even before that. All this money spent on furlough etc has to be payed back somehow.

I'm worried. I'm a solo homeowner trying to do up a renovator bit by bit. I think my job is secure, but I don't have a huge amount of savings as I save, and then it goes on the house - nothing flash, just stuff that's needed. I think my job is safe (lower level civil servant) but no payrise and we don't get paid overtime so I don't have much to play with.

I'm going to stop doing work on the house, and work on trying to build up my pot of savings (it's only £600 so I have work to do). No hair cuts, no treats, and I'll work out of the office more than I currently do, so the heating can stay off. I'll ride to work which I used to do anyway. For those of you considering cycle-commuting, if you haven't done that before and are nervous, lots of local councils do free or cheap classes with a commuting coach, to show you the best routes, and how to ride confidently in traffic. The weather will get warmer, the days longer, and as people try to drive less there will be less cars on the road hopefully. There's never a better time to try it out than now.

Ah TwigTheWonderKid beat me to it!

It all feels rather bleak. We are hoping to put our house on the market soon, delayed moving because of new baby, then covid, then school application… upsizing to bigger house, increasing the mortgage… is now the time to do it before things get really bad or do we stay put and ride it out?!

It's a perfect opportunity to invest in green tech.

Better insulation, boilers, renewables, solar panels, bike lanes - a government funded green revolution would create so many jobs and reduce our dependence on oil and gas from shitbags like Putin.

If you mean one they cant spend their way out of, then yes.

I think economy is fucked for a while.

I'm taking extra work to try and pay for all the petrol increase and bill's. But making cuts other places.

YANBU

Doesn't this mean that all the businesses which struggled through Covid and furloughed staff etc - so cafes, restaurants etc will put up prices?

I've got a new hairdresser who's lovely (my best so far!) and she opened her salon last autumn/winter, she won't want to put up her reasonable prices but she may have to! I could just about afford them. But the small independent organic grocer/greengrocer will have to put up prices etc.

I don't need a second job but surely if people want extra work, local cafes/restaurants where lots of the workers headed back to their own countries due to Brexit, well the work is there. Noticed at least 2-3 restaurants require extra staff.