With the next Bank of England interest rate decision timed for tomorrow, it’s just been revealed that rate increases so far this year have added £71.50 to the typical mortgage.
Research by Revolution Brokers found that back in December 2021, a standard variable mortgage paid on a typical loan was £1,214.35 per month.
In the months since, the base rate has increased by 1.0 per cent in total, pushing the average mortgage rate up to 4.25 per cent. As a result, monthly payments on the average variable rate mortgage have increased by £71.50 to £1,285.85.
Based on average house price costs and mortgage loans amongst home owners of all kinds, the biggest regional increase has, unsurprisingly, been in London where payments are up £128.97 per month. Outside London, the largest increase has been in Elmbridge, Surrey, where payments have spiked by £179.12.
A Revolution Brokers spokesperson says: “These payment increases are significant, to say the least. A national increase of more than £70 per month means that hundreds of thousands of households will have seen their disposable income squeezed even further, during what is already a very tough time.
“Variable rate mortgages always come with a modicum of risk as it’s difficult, sometimes impossible, to predict what economic ups and downs are on the horizon.
"The coming months could be very difficult for the average homeowner, as interest rates look set to keep rising, putting even further pressure on our finances in the process.”