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UK mortgage statistics, 2023

This page includes relevant mortgage statistics for 2023, such as the number of mortgage approvals, interest rates, house prices, and mortgage fraud statistics.
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Our research has allowed us to compare mortgage data over time, and analyse trends, in order to judge how key UK mortgage market statistics have evolved in recent years.  

A mortgage is a long-term loan taken out to purchase a property, and for many people this will be the most expensive financial product they ever take out in their lifetime. Therefore it is important to understand how mortgages work, in order to pick the right mortgage deal for you. 

The UK mortgage market is in a constant state of flux and influenced by numerous variables, which means it is dynamic and ever-changing. By compiling the latest in UK mortgage statistics for 2023, the aim of this page is to provide you with some of the most up-to-date figures, that will help you make informed decisions about your own current, and potentially future, mortgage deals.

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UK mortgage application statistics 

UK mortgages by age group and type of people

For many young people, it’s difficult to get onto the property ladder and owning a home may not be possible until later in life.

A breakdown of UK mortgages by age group
A donut pie chart to show the breakdown of UK mortgages by age group

In 2021, only 0.7% of homeowners were between the age of 16 and 24. This rose to 11.2% for those in the 25-34 age bracket, and 15.4% for those between 35 and 44 years of age. Less than a fifth were 55-64 years old. 

The overwhelming majority were those aged 65 and over, occupying over one-third of the homeowner market. 

According to mortgage statistics, the majority of households (64%) in the UK are owner-occupier, which means either owning a home outright, or owning a home with a mortgage. This equates to an estimated 24.7 million households.

In 2020, approximately 8.8 million (36%) were owned outright, with 6.8 million (28%) owned with a mortgage or a loan. 

The distribution of all owner-occupied households in the UK does however vary significantly between age groups and how their properties were purchased. The data shows that those in the older age brackets are more likely to purchase a property outright compared to those in the younger brackets. 

A breakdown of UK homeownership by age group and how they purchased their property
Bar chart showing the number of people from different age groups and how they purchased their property, either through mortgages or owning outright.

Generally speaking, as the age group increased, so did the percentage who bought their property outright. Only 0.2% of outright owners were between the ages of 16 and 24, compared to nearly 62% of those aged 65 and over. 

Over half (58%) of those people who purchased their house with a mortgage were between the ages of 35 and 54. By comparison, only 12.8% of this age bracket purchased a house outright in 2021. 

The largest share of UK homeowners in 2021 were couples with at least one dependent child, representing 32% of the market. Almost a quarter (24.6%) were couples with no dependents, compared to less than 5% who were couples with at least one independent child.

In 2021, there were over 187,000 new mortgages approved to borrowers aged 55 and above, at a cost of £28.1 billion. Compared with 2020, this is an 11% increase in mortgage numbers and a 22% increase in the value of lending for the same age group. These figures represent the highest annual volume and value of mortgage borrowing for the 55+ age bracket since 2014, when records began. 

These trends were driven largely in part by the stamp duty holiday, which encouraged homeowners of all ages to move or invest in additional properties. This holiday ended in September 2021, causing activity to slow down. 

In Q4 2021, there were 44,500 new mortgages to the over 55s, at a cost of £6.8 billion. This represented a decrease of 2.6% on the previous quarter, and a 3.6% fall on the same time in the previous year. 

Conversely, the number of lifetime mortgages for Q4 2021 was 10,860 (an increase of 7.5% compared with three months earlier). 

A breakdown of UK mortgage lending statistics for different age groups in society 
An infographic to show various mortgage lending statistics for different age groups, including Millennials, Gen-Z, and Gen-X

One of the reasons for the lack of affordable housing in the UK are the rates of multiple home ownership. A study by Joseph Rowntree Foundation found that between 2000 and 2020, the number of adults owning multiple properties in the UK increased by 147%. In the same time period, the number of 16-34-year-olds trying to enter the housing market dropped by 38%. 

Mortgage comparisons over time indicate that in 2020, just 21% of the Millenial and Gen-Z age bracket owned their own home, compared to 36% in 2000. 

Mortgages by property type 

A breakdown of UK mortgages by the type of dwelling
A tree map to show the percentage of mortgages attributed to different types of property in the UK

In terms of dwelling type, detached properties had the highest share of UK mortgages in 2020. This constituted around 38% of dwellings with a mortgage, compared to semi-detached, with 29%. Bungalows were the least common, with only 1% of mortgaged properties falling under this category. 

UK mortgage approval statistics  

The number of mortgage approvals is an indicator of potential future lending. 

A breakdown of mortgage approval numbers between 2021 and 2022
A stacked bar chart to show UK mortgage approvals by type of purchase between 2015 and 2022

Since July 2021, the number of mortgages approved for house purchases in the UK has been in steady decline, from just over 76,000 to just under 64,000 in June 2022. This is below the 12-month, pre-pandemic average (up to February 2020) of 66,700. 

Note: December 2021 and January 2022 saw a slight increase to figures over 70,000. However, since then, numbers have continued to fall. 

UK mortgage approvals over time 

The recent decline in mortgage approvals between 2021 and 2022 is not necessarily reflective of the long-term trends for UK mortgages. 

From January 2012, the number of mortgages approved was on an upward trend, rising to a peak of almost 70,000 in January 2014. For the next six years, these figures fluctuated between 60,000 to over 70,000 approvals per month until the Covid-19 pandemic struck in March 2020. 

This had a profound impact on mortgages during the following months, as numbers plunged to an all-time low of 9,300 in May 2020. 

With the easing of initial lockdown restrictions, the housing market began its recovery. There was a rapid increase in the number of mortgage approvals to over 100,000 in November and December 2020. After this point, numbers have started to stabilise once again to around 60,000 per month.

A breakdown of UK residential mortgage approvals over time
A breakdown of the average monthly UK house purchase approvals between 2007 and 2021

When broken down by month, we can see that historically, UK mortgages are most commonly approved in June, July, and March with all three months exceeding 70,000. These figures drop considerably in the winter months across December and January to around 46,000, before rising again in February to 58,000 per month. For the remaining months of the year, monthly mortgage approvals fluctuate around 65,000.

 A breakdown of the average monthly UK house purchase approvals between 2007 and 2021
Bar graph to show the total number of UK mortgage approvals between 2021 and 2022.
 Mortgage approvals by type of purchase
A breakdown of first-time buyers as a percentage of all house purchase loans

A gross advance is the total value of a residential mortgage loan, advanced by societies in period. This can include loans for reasons such as house purchases, further advances, and remortgaging.  

Since 2015, the percentage of first-time buyers (FTB), owner occupiers, and buy-to-let (BTL) homeowners have remained about the same, with some minor fluctuations. 

Owner occupiers continue to dominate the mortgage market in 2022, with over 45% of homeowners falling into this category. This has largely been the case since 2015, apart from Q4 2020 to Q2 2021, when this figure exceeded 50%. 

The percentage of FTBs each year has remained around 30%, but dipped to 24% at the beginning of 2016 (the lowest point across the last seven years). As of 2022, one in three homeowners was a FTB. 

The BTL scheme has been the least preferred way to enter the UK housing market. This figure spiked in Q1 2016 to over 30%, however, has generally remained in the mid-to-low 20s. At the end of 2020, less than 15% of people were purchasing properties in the UK through the scheme, the lowest point in the previous seven years. 

As of 2022, this had risen back up to over 20%.

Compare first-time buyer mortgages and buy-to-let mortgages to find the best deal for your circumstances.

UK first-time buyer (FTB) mortgage approvals

A breakdown of first-time buyers as a percentage of all house purchase loans
Combined bar chart and line graph to show the number of first time buyers in the UK between 2009 and 2021 alongside this number as a percentage of all house purchases.

The number of UK first-time buyer mortgages has been on a steady rise since 2009, from around 193,000 to almost 410,000 in 2021. A slight drop to just under 304,000 in 2020 can be attributed to Covid-19, when mortgage applications were extremely low across the country. 

The number of FTBs as a percentage of all UK home-purchase loans has also steadily increased over time. In 2010, FTBs accounted for 37% of all home buyers in the UK, which rose to a peak of 51% in 2019. This figure has dropped slightly since but still remains around 50%, meaning half of UK residents buying a home today, are FTBs.  

A breakdown of the average age of first-time buyers in different regions of the UK
A butterfly bar chart to show the average age of first time buyers in different regions of the UK between 2011 and 2021

UK Mortgage Statistics 2022 - A breakdown of the average age of first-time buyers in different regions of the UK. - Image moduleAs of 2021, the average age for a first-time buyer (FTB) in the UK was 32 years old. This is a rise of three years from 2011 when the average age was just 29. 

This age trend has been reflected in all regions of the UK, with the West Midlands and Wales seeing the biggest rise, from 29 to 31 and 28 to 31 years respectively, between 2011 and 2021. 

The UK region with the highest average age for FTBs in 2021 is London (33 years), whereas, in the North East and Yorkshire and the Humber, you can expect to own a house by the time you are 30. 

There is not much between the home nations either. In Northern Ireland, you can expect to purchase your first home by the time you are 32, whereas in England, Wales, and Scotland, this figure is 31.

Line graph showing the value of UK mortgages between 2007 and 2022, in terms of total mortgage expenditure and average weekly wage.
Value of UK mortgage approvals

Since 2007, the average weekly pay for UK citizens has steadily been on the rise. In Q1 2022, this stood at £600 a week, a 30% rise over the previous 15 years. The total value of UK mortgages during this time has generally been on an upward trajectory. 

At the start of 2009, mortgage spending reached £12 billion, the lowest amount since the beginning of 2007. This was following a peak of almost £57 billion in 2007, after which it dramatically decreased (a direct result of the global financial crisis in 2008). 

In the following 11 years, mortgage expenditure grew to over £40 billion before Covid-19 hit, causing a decrease of £16 billion within Q2 2020 alone. A year later, saw the highest amount of money spent on UK mortgages ever recorded, reaching almost £70 billion. As of Q1 2022, this figure stood at £49.3 billion. 

Mortgage approvals by purpose 

A breakdown of UK mortgage approvals by type of purchase
Stacked bar chart to show the breakdown of mortgage approvals by type of purchase between 2015 and 2021.

Since the start of 2015, the share of house purchase and remortgage loans have generally followed opposite patterns. The percentage of loans for house purchases has been on a steady decrease, with a gross advance of 70% in Q3 2015 down to almost 56% in Q2 2020. 

Conversely, loans for remortgages have been on a steady increase since Q3 2015, starting at around 24% and rising to a peak of 37.8% in Q2 2020. 

After this point, gross advances for house purchases saw a dramatic increase to over 75%, whereas those for remortgages saw a rapid decrease to around 18%. 

Loans for further advances and other reasons have remained steady over the last seven years, both fluctuating between 2 to 4%. 

UK mortgage fraud statistics 

Mortgage fraud usually involves individual(s) or organised criminal gangs working in tandem with at least one corrupt associate, such as an accountant, solicitor, or surveyor. 

This can take many forms, including:

  • Over-valuation of a property

  • Overstating a salary or income 

  • Taking over genuine conveyancing processes 

  • Committing identity theft (such as taking out a mortgage in someone else’s name without their knowledge, or that of a deceased person)

  • Taking out multiple mortgages with different lenders on one address 

  • Manipulating or falsifying Land Registry data 

  • Changing the deeds to a property without the owner’s knowledge and using this to then sell the property.

A breakdown of UK mortgage fraud by first and third-party fraud
A stacked line graph to show the amount of first and third party mortgage fraud in the UK between 2017 and 2022

Between 2017 and 2022, the overwhelming majority of mortgage fraud has been first-party (meaning there is no abuse of identity details and the fraudster is indeed the person applying for the mortgage). Over this six year period, this figure has remained over 90%, reaching highs of 97% in Q3 2017 and Q2 2020. 

First-party fraud accounted for 92% of mortgage fraud in Q1 2022 (the second lowest quarter after 91% in Q2 2019). This means for this quarter, 8% was attributed to third-party fraud, whereby someone creates or uses accounts of other people without their consent. This is most commonly associated with identity fraud. 

A breakdown of UK mortgage fraud rates over time
A line graph to show the rate of UK mortgage fraud between 2019 and 2021

Between 2019 and 2021, the rate of mortgage fraud has generally remained very low, with some minor fluctuations. Q3 and Q4 2019 both saw rates of 0.66%, the highest they have been in the previous few years. 

Q3 2020 and Q2 2021 both saw the lowest rates of UK mortgage fraud, at 0.43%. After this point, the rate continued to rise, back up to 0.57% in Q4 2021 (the same rate as Q1 2019). 

A breakdown of UK mortgage fraud rates in 2021
Line graph to show the UK mortgage fraud rate throughout 2021

When broken down monthly-by-month for 2021, there has been a steady fall and rise in the rate of UK mortgage fraud. In January 2021, the rate stood at 0.59%, before decreasing to a low of 0.38% in April. After which, mortgage fraud rates have been on the increase, reaching a peak of 0.67% in December 2021. 

A breakdown of UK mortgage fraud by category
A pie chart to show the percentages of different categories of mortgage fraud in the UK

In terms of types of mortgage fraud, the vast majority experienced in the UK is down to misrepresentation of employment. This accounts for almost half of all fraudulent mortgage cases, whereby the applicant may lie or withhold information about who they work for and/or how much money they earn. Misrepresentation through false documentation is the second most common cause of UK mortgage fraud, accounting for over 17% of all cases, followed by other forms of misrepresentation (almost 13%). 

Direct identity theft accounts for less than 0.3% of mortgage fraud and is the least common cause, followed by misuse of a product and avoiding/falsifying payments, both occurring in just under 5% of cases. 

UK mortgage fraud alert scheme 

The UK Land Registry department now offers a free alert scheme to protect homeowners against fraudulent property transactions. Figures obtained by risk management company Thirdfort, show that there has been a 300% increase in the number of homeowners registering for this service since 2020. 

In 2020, just over 46,000 property owners signed up as part of the alert scheme. By 2021, this had risen by over 135,000, and by August 2022, more than 110,000 had already completed an application.  

Since the free service was launched in 2014, more than 515,000 households are now signed up to the scheme. However, with approximately 28 million homes in the UK, this only represents about 2% of the UK property market.

UK mortgage lending statistics  

Monthly UK mortgage lending 

A breakdown of UK monthly mortgage lending over time, according to HMRC and BoE
Line graph to show the number of monthly UK mortgage transactions according to the HMRC and BoE, between 2005 and 2022

n June 2022, HMRC provisionally announced around 95,400 mortgages had been approved for residential transactions. This was 5.4% lower than the same month in 2019. Meanwhile, The Bank of England (BoE) reported 63,700, which was almost 5% lower than in June 2019. 

When drawing mortgage comparisons between HMRC and BoE, they have both followed similar trends, with the former usually denoting more monthly transactions than the latter. 

HMRC figures were moderately high throughout 2006, reaching a high of 149,500 in December. This was followed by a sharp decline, down to 51,600 monthly transactions in January 2009. After this, numbers started to rise gradually up until January 2020, with a severe spike in March 2016 of 174,800. 

Once Covid-19 hit, monthly mortgage transactions, according to HMRC, fell to 41,500 in April 2020, before dramatically fluctuating over the coming months. They peaked in June 2021 at 208,750. 

The BoE figures largely follow a similar pattern, reaching 126,200 mortgage transactions in October 2006. This dropped to 26,300 in November 2008, around the time of the global financial crisis. Again, monthly figures for mortgages steadily increased up until May 2020, when they plummeted to around 9,300. 

The BoE figures stabilised much quicker compared to HMRC over the coming months, reaching a high of 105,500 in November 2020 before dropping back to pre-pandemic levels.

The value of UK mortgage lending 

A breakdown of the total value for British mortgage lending over time
Horizontal bar graph to show the total value of British mortgage lending over time

In 2021, the total value of British mortgage lending reached a staggering £316 billion, a level not seen since 2007, when this figure was £372 billion. The lowest value was seen in 2010 when mortgage value totalled £146 billion (more than half the amount for 2021). 

Since 2010, the UK mortgage market has been on a general upward trend, in terms of year-on-year gross mortgage lending to individuals. 2020 became the first year to see a significant decrease since 2008, with almost £250 billion worth of mortgages sold. 

A breakdown of the value of UK mortgage lending over time
A line graph to show how UK mortgage lending has changed between 2018 and 2021 in terms of the total value

When broken down by quarter, there have been steady fluctuations since 2018 in the amount of new mortgage loans to borrowers. Between Q1 of 2018 and Q1 of 2020, this varied between £62.4 billion and £73.5 billion. 

The first half of 2020 experienced a significant drop in mortgage lending, down to £44 billion, after which it gradually rose again as the housing market began its recovery. By the second quarter of 2021, this figure had more than doubled, to record highs of £89 billion in quarter-on-quarter lending. 

Breakdown of the value for secured lending on UK dwellings over time
Line graph to show the value of secured lending on UK dwellings over time between 2017 and 2021

These trends are further reflected in the monthly value of approvals for lending that have been secured on dwellings. This includes house purchase loans as well as those remortgaging a property. 

Between 2017 and 2019, there is very little variation in the value of secured lending. Monthly figures fluctuated from around £20 billion, until February 2020, when they reached £25 billion. After this point, they fell dramatically to just over £7 billion in May 2020, before rising up to £29 billion in November 2020. 

With the ease of Covid-19 lockdowns and the introduction of tax breaks for home buyers, these mortgage values quickly recovered, surpassing the pre-pandemic levels as of September 2021.

UK mortgage lending from building societies 

A breakdown of the value of gross mortgage lending by UK building societies over time
 Line graph to show the value of gross mortgage lending by UK building societies between 2017 and 2021

Unlike banks, building societies are not listed on the stock market, and therefore don’t have external shareholders. Instead, the “owners” and decision-makers are mortgage borrowers, savers, and current account holders. 

As of March 2021, gross mortgage lending by building societies peaked at around £7.7 billion, the highest level over the previous four years. Generally, since 2017, there have been some significant fluctuations in the value of building society mortgage lending, between £4 billion and £6.5 billion. April 2020 saw a drop to around £2.9 billion, after which it began to increase once again. 

Mortgage rates statistics 

A breakdown of the percentage of mortgage rates in relation to the Bank of England base rate
Line graph to show the percentage of mortgage rates that above the Bank of England base rate between 2020 and 2022.

When comparing mortgage rates over the last few years, there have been some significant changes in the percentage of people taking out different mortgage deals. 

As of the first quarter (Q1) 2022, over 85% of gross mortgage advances had an interest rate that was less than 2% above Bank Rate (BR). This is the highest it has been since the third quarter (Q3) 2008. In the two years leading up to 2022, this figure had never exceeded 75% and even reached as low as 56% in Q2 2021. 

The share of advances with interest rates between 2% and 3% above BR decreased between Q4 2021 and Q2 2022, from 19% to 9.8%, respectively. A similar pattern was observed for those mortgage advances between 3% and 4% above BR, going from 7% to 2.8%. Those that were 4% or more above BR also dropped, from 2.8% to 1.9%. 

A breakdown of fixed and variable interest rates in the UK over time
Line graphs to show how the fixed interest rates and variable rates have changed in the UK for 2, 3, 5, and 10 year mortgages between 2000 and 2022

As of February 2022, the 10-year fixed mortgage rate was at its lowest (2.2%). This has followed a general downwards trend since March 2000, when it stood at 6.5%. 

Both three-year and five-year fixed mortgage rates reached 1.79% in February 2022, which was an increase from 1.39% and 1.59% respectively from December 2021. 

The two-year fixed mortgage rate was 1.76%, as of February 2022. This was 0.56% higher than the lowest ever recorded rate in September 2021. 

By comparing mortgage rates over time, we can see that there has been a general decrease in fixed rates since 2000. The 10-year fixed rate in 2009 stood at 6.28% in June, and by September had dramatically fallen to 2.59%. After this point, 10-year fixed mortgages were not offered again until September 2014, when the rate resumed at just over 4%. 

From 2009 to the start of 2022, UK mortgage rates were generally on a downward trend, which was good news for first-time buyers and those looking to remortgage a property. 

Inflation has continued to rise throughout the year, reaching 10.5% in December 2022. In an attempt to curb the rate of inflation, the BoE has started to increase the bank rate (BR), which as of January 2023 stood at 3.5%. On 2 February, the BoE decided to increase this by a further 0.5%, to 4%. This has resulted in a rise in mortgage rates and will increase the cost of borrowing. Although this increase may also reduce the demand for housing and slow down rising house prices.

Effective interest rates

A breakdown of the effective interest rates on outstanding mortgage stock and new secured loans in the UK over time
Line graph to show the effective interest rates for outstanding mortgages and new secured loans in the UK between 2016 and 2022.

BoE figures show that the effective interest rate on new and outstanding mortgages rose to 2.1% in June 2022, representing one of the biggest jumps in the effective rate since 2015. 

Since 2016, the effective rate for new mortgages and outstanding ones has generally decreased, falling respectively from 2.5% and 3.5% in January 2016 to lows of 1.6% and 2% in January 2022. 

Standard variable rates (SVR)

The standard variable rate (SVR) is typically paid by borrowers who have come to the end of their fixed or variable-rate (usually discounted or tracker) deal. It’s normally set at the discretion of the lender, however, the BoE base rate can influence this. 

In July 2022, the average SVR for UK mortgage borrowers exceeded 5% for the first time in 13 years. In January 2009, the typical SVR stood at 5.14%, and by the start of July 2022, it had risen to 5.06%. 

Between December 2021 and July 2022, the BoE increased the base rate five times, taking it from a historic low of 0.1% to 1.25%. As of January 2023, the base rate stood at 3.5%, before being increased further on 2 February 2023 to 4%. In March 2023, it increased again to 4.25%.

The average rate for July 2022 is up from 4.91% in June and 4.4% in December 2021, before the BoE increased interest rates. Some lenders have passed on every increase to the consumer, whilst others have opted not to. 

SVRs also vary between lenders. As of July 2022, Hinckley & Rugby Building Society and Saffron Building Society were both charging 6.19%, whereas Newcastle Building Society was only charging 3.96%. 

According to banking industry statistics, at the end of 2021, over a million borrowers were paying their lender’s SVR, and the average amount outstanding for these mortgages was around £76,000.  

Every time the rate increases by 0.25%, about £16 a month is added to repayments. Based on a mortgage balance of £200,000 over 25 years, and comparing monthly repayments at rates of 5.06% and 3.74%, someone switching from the average SVR to a two-year fixed rate mortgage in July 2022, might be able to save around £150 a month on their mortgage repayments.

The outstanding value of UK mortgage arrears 

A breakdown of the value of UK mortgage arrears by gross advances and new commitments
Pictogram to show the number of UK mortgage arrears based on the number of homeowners and buy-to-let mortgages

The number of UK mortgages in arrears stands at 83,610. This means more than 83,000 households are behind with their monthly mortgage payments. 

The vast majority of these (almost 93%) are homeowner mortgages, whereas the remaining 7% (almost 6,000 people) are buy-to-let (BTL) mortgages

When broken down into arrear type, most UK homeowners and BTL customers have between 2.5% and 5% of their mortgage balance in arrears. 

This applies to 36% of homeowners (with 28,100 having between 2.5 to 5% of their balance in arrears), and almost 45% for BTL mortgages (with 2,680).

The outstanding value of UK mortgage arrears 

A breakdown of the value of UK mortgage arrears by gross advances and new commitments
Combined bar graph and line graph to show the value of gross advances in mortgage arrears and new commitments of mortgage arrears in the UK between 2020 and 2021.

At the start of 2022, the total value of all outstanding residential mortgage loans stood at £159.4 billion. This was less than 1% lower compared to the same period in 2021, yet more than 7% higher than the fourth quarter of 2021 (£147.5 billion). 

The value of gross mortgage advances grew between Q2 2020 and Q2 2021, where it reached a peak of £86 billion. After this point, it decreased and stabilised at around £75 billion per month. 

In terms of new mortgage commitments, the value of outstanding monthly payments increased throughout 2020 by £53.3 billion, to a peak of £87.7 billion. Throughout 2021 and Q1 2022, this amount has slowly decreased with some fluctuations, down to £82.5 billion.

UK mortgage debt statistics over time 

Throughout 2022, the total number of customers in arrears with their mortgage lender has continued to decrease. Overall, at the end of June 2022, there were around 74,500 mortgages in arrears, representing 2.5% or more of any outstanding balance. This was 0.3% less than March 2022, and 10% fewer than June 2021.   

In terms of buy-to-let mortgages, this figure stood comparatively at 5,640. This is 4% less than Q1 2022, and a 10% reduction from the previous year. For homeowner mortgages, this number stood at just over 25,000. This represents a 1% increase since the start of 2022, but 14% fewer than the start of 2021. 

Astonishingly, over 28,000 homeowner mortgages had arrears, representing more than 10% of the outstanding balance.

A breakdown of net borrowing of UK mortgage debt over time
Bar chart to show the net borrowing of UK mortgage debt between 2021 and 2022

As of June 2022, net borrowing of mortgage debt by UK individuals stood at £5.27 billion, down from just over £8 billion in May 2022. 

Like many other trends in UK mortgages, there has been some significant fluctuation over time. September 2021 saw a peak of £9.2 billion, which then dropped to £1.5 billion the following month. 

In the 12 months leading up to February 2020, the monthly average was £4.3 billion of net mortgage borrowing. With the exception of October to December 2021, all remaining recent months have exceeded this pre-pandemic average. 

Gross lending of UK mortgages decreased to £25.4 billion in June 2022, from £28.1 billion in May, whereas gross mortgage repayments dipped only slightly, from £21.2 billion in May 2022 down to £20.3 billion in June.

A breakdown of total money secured on UK dwellings between 2018 and 2021
An area graph to show how the amount of money secured on UK dwellings has changed between 2018 and 2021

 The amount of money secured on dwellings in the UK has slowly been increasing over time. In May 2018, this figure stood at almost £1.38 trillion. By September 2021, this amount had increased by 11%, to £1.55 trillion. 

Outstanding mortgage balances with arrears 

A breakdown of UK mortgage lending by total amount and type of mortgage borrower
A combined bar graph and line graph to show the total amount of mortgage lending in the UK between 2020 and 2022. It is broken down by percentages that belong to different types of borrowing, such as remortgaging, first-time buyers, buy-to-let, and home-movers

As of Q1 2022, the total value of outstanding mortgages with arrears stood at almost £77 billion, the highest amount since Q2 2021 at just over £89 billion and almost £7 billion more than the previous quarter. 

The share of gross mortgage advances for home movers was 29.3% in Q1 2022, narrowly ahead of those remortgaging (29%). Conversely, first-time buyers (FTB) accounted for 21.4%, and buy-to-let (BTL) was 13.4%. 

Mortgage advances for remortgaging were almost 38% in Q2 2020 but decreased to 18% in Q1 2021. Contrary to this, advances for FTB mortgages were just over 18% in Q2 2020 and gradually rose to a peak of 24.7% in Q2 2021. 

During this same period, the percentage of gross advances for home movers also peaked at 42.3% (the highest representation of any group over the previous two years). 

A breakdown of outstanding UK mortgage balances over time 

A combined bar and line graph to show the value of outstanding mortgages balances in the UK and the percentage of outstanding balances in relation to total loan balances between 2020 and 2022

The value of outstanding balances with arrears refers to borrowers who fail to make their contractual (re)payments that are equivalent to at least 1.5% of the outstanding mortgage balance, or where the property is in possession.

At the beginning of 2022, the value of outstanding balances with arrears amounted to £13.3 billion. This represented a decrease of 1.1% since the previous quarter, and a drop of 11% compared to the same period in 2021 (£15 billion). As a percentage of total outstanding mortgage balances, this equated to 0.82%, the lowest since records began in 2007.

UK mortgage repossession statistics    

Mortgage repossessions occur when a borrower fails to keep up with mortgage (re)payments, and the lender takes possession of the property. This is always used as a last resort, once all other options have been exhausted and individual financial circumstances have been taken into account. 

A breakdown of UK mortgage repossessions over time 
A bar graph to show UK mortgage repossessions between 2013 and 2022

Between 2013 and 2022, the number of repossessions of UK properties has decreased dramatically, from almost 53,500 to just over 10,000 at the end of 2021. Numbers are slowly back on the rise, with almost the same amount of repossessions in the first half of 2022 compared to the whole of 2021. 

In the second quarter of 2022, almost a thousand (980) UK properties were taken into possession by the courts for failing to keep up with mortgage repayments. 630 of these were from homeowners, whilst 350 were buy-to-let properties. These figures represent a 45% increase in repossessions from Q2 2021, however only half of those seen in 2019.

From January to March 2022, the number of orders for possession stood at almost 2,300, and almost 2,200 for warrants. This represents a respective 47% and 55% drop from the same period in 2019. In terms of mortgage possession claims, this stood at around 2,900 (a reduction of 53% from 2019). 

Due to the postponement of court proceedings during Covid-19, there were only 10 repossessions between April 2020 and March 2021, whilst 571 took place between January and March 2022.

A breakdown of mortgage repossessions in England and Wales by region
Coloured map of England and Wales to show the number of repossessions in different regions

Regionally, there is some significant variation across the UK in terms of the number of repossessions. With a total of over 102,000, 30% of all repossessions can be attributed to London properties, followed in second place by the South East, with around 11% (37,000). The North East has the least amount of property repossessions, with just under 16,000, followed by the East Midlands, with just over 23,000 in total. 

Mortgage-free statistics 

A breakdown of when UK homeowners expect to be mortgage-free 
A pie chart to show the age that different UK homeowners expect to be mortgage free

Most UK residents who have a mortgage expect to pay it off between the ages of 65 and 74. In 2021, this represented over 580,000 people, and almost 50% of the mortgage population. 

Only 115,000 will pay off their mortgage before they turn 55, accounting for less than 10% of people. Remarkably, over 23,000 people will still be paying off their mortgage beyond the age of 75. However, this is around 2% for those who have a mortgage.  

However, as a percentage of those who have a mortgage, this is around 2%. 

In a survey of 2,000 people, research by Hargreaves Landsdown found that one in six people (15%) expect to pay off their mortgage by the age of 65. This figure rose to 19% by the age of 70, whilst 5% believe they will never be mortgage-free. 

Of these people, the average age borrowers expect to pay off their mortgage is 59. However, 16% said they did not know. Almost three-quarters (74%) of those who have retired have already paid off their mortgage in full, whereas 6% still have a mortgage. 

UK mortgage market statistics

A breakdown of UK building societies by value of assets
A bubble chart to depict the value of assets for UK building societies. Bubbles are proportional in size to the value of assets.

In terms of society assets, Nationwide dominates the UK mortgage lending market, with over £269 billion. This accounts for over half (54%) of all society assets on the market. 

Yorkshire Building Society and Coventry Building Society are second and third, with respective £66 billion and £53 billion worth of assets. Skipton (£27 billion) and Leeds (£22 billion) complete the top five. 

A breakdown of UK mortgage lenders by market share percentage 
Radial bar graph to show the market share percentage of UK mortgage lenders

Since 2010, gross UK mortgage lending has steadily been on the rise. In 2020, the 10 largest mortgage lenders accounted for approximately 84% of the market, with the top five alone accounting for 64%. 

Lloyds Banking Group had the largest market share, with 19.5%. This equated to around £46 billion worth of lending in 2019 alone. 

The second largest lender was Nationwide Building Society, accounting for 12.7% of gross mortgage lending. This is followed by Santander UK in third, with just over 11%, and Natwest in fourth, occupying just under 11% of the market.

UK mortgage complaint statistics
 A comparative bar chart to show the number of complaints to the Financial Ombudsman Service between 2009 and 2020.

 Between 2009 and 2020, the number of complaints to the Financial Ombudsman regarding mortgage products, services, and endowments fluctuated. In 2020/21, more than 12,600 new customer complaints were logged, with almost 94% of these regarding mortgage products and services.  

 Complaints regarding mortgage endowments have been historically low since 2009. They rose to a peak of over 4,600 in 2012, accounting for 28% of all registered mortgage complaints for that year. However, in 2020, they were at a record low, at only 769 for that year.

UK house price statistics  

UK house prices by type of transaction 

A breakdown of house prices across different types of transaction for England, Wales, and London 
A combined bar chart and dispersion diagram to show the average house prices in England, Wales, and London for different types of transactions between 2021 and 2022.

It is widely known that house prices vary considerably across the UK. In May 2022, the average property price in England was around £311,000 (a 13% increase on May 2021 and a 1.3% rise on the previous month). Comparatively, in London, the average house will set you back over £520,000 (a rise of 8.5% on the previous year and 0.5% on April 2022). A house in Wales will cost, on average, around £216,000—almost 60% less than in London. However, this is 14.5% more than May 2021. 

By contrast, in April 2022, the average house price in Scotland was just under £188,000 (a 3% increase on March 2022 and 16% increase on April 2021). For Northern Ireland, comparative figures were just over £164,500 for the average property price (an increase of 3.4% and 10.4% for March 2022 and April 2021 respectively). 

Cash buyers can expect to pay, on average, about £15,000 more for a property in London compared to mortgage buyers. However, they pay £28,000 less in England and £11,000 less in Wales. By comparison, cash buyers in Scotland can expect to part with around £171,000, compared to over £195,000 for mortgage buyers. 

First-time buyers, on the other hand, can expect to get a house for around £250,000 in England, £450,000 in London, and £180,000 in Wales. Yet, all three have seen large increases in their prices over the previous 12 months, between 7-14%. In Scotland, this figure stands at just under £150,000 (almost 15% more than 2021). 

House prices continued to rise into July 2022, but at the slowest monthly pace in over a year. They were 0.1% higher than in June 2022, when they rose by 0.2%. Compared to the same time last year, house prices were 11% higher. 

Data from the Halifax House Price Index highlights that the average UK house in July 2022 would cost just under £295,000. The pace of growth is the highest since 2004, while the 1.8% rise in June 2022 was the largest monthly increase since 2007. 

Data from the BoE for June 2022 showed the lowest number of new mortgage approvals in the last two years, suggesting the housing market is showing signs of cooling off after a recent surge in demand. In 2022 alone, the price of the average home has risen by 6.8%, approximately £18,000.

UK house prices by region 

A breakdown of house prices in England by region for May 2022
Map of England depicting average house prices for each region, the annual change from May 2021, and the monthly change from April 2022.

According to Gov.uk data from May 2022, the average house price in England rose by 1.3% from April 2022. The annual price hike of 13% took the average property value to just over £300,000. 

Regional data indicates the following trends:

  • The South West experienced the greatest increase in average property prices, at nearly 17% compared to last year. 

  • London saw the lowest annual price growth (8.2%) yet still remains the most expensive place to buy in the country (over £525,000). 

  • The North West and North East were the only two areas of the country to see a fall in property prices compared to April 2022, with -0.2% and -0.1%, respectively.

  • The East of England had the greatest monthly growth, with an increase of 2.6% compared to April 2022 prices. 

Those saving for a 10% deposit on a property in 2022, would have likely had to raise an extra £1,800 since January just to keep up with rising prices. 

A breakdown of average house prices in Scotland
Local authorityAverage house price (£) April 2022Monthly change (from March 2022)Annual change (from April 2021)
City of Edinburgh324,9470.4711.55
East Lothian289,711-1.2613.21
East Renfrewshire287,3511.3916.74
East Dunbartonshire260,0381.9812.34
Perth and Kinross235,2692.610.24
Midlothian232,6201.8213.68
Stirling226,732-0.177.79
Orkney Islands220,73916.2634.34
Aberdeenshire204,0872.210.42
Scottish Borders203,4854.6722.85
Highland202,6390.311.31
West Lothian196,887112.01
Moray189,0925.118.51
Shetland Islands187,9391.24-0.63
Argyll and Bute180,810-1.6317.11
South Ayrshire166,3070.7713.65
Fife164,831-1.5613.64
City of Glasgow163,494-0.019.07
Angus162,2420.777.45
Falkirk162,1951.3519.49
Clackmannanshire160,2401.3213.96
Nah-Eileanan Siar159,2883.3225.15
Dumfries and Galloway159,2111.1514.61
South Lanarkshire157,867-0.1813.29
Renfrewshire149,3801.4613.2
City of Aberdeen147,5622.315.9
City of Dundee145,5692.885.58
North Lanarkshire132,4240.6113.24
West Dunbartonshire131,6730.911.12
North Ayrshire124,0402.6314.04
East Ayrshire122,334-0.4216.42
Inverclyde111,462-4.553.6

Across Scotland, we can see some distinct variations in house prices. The City of Edinburgh is the most expensive part of the country, where the average house will set you back almost £325,000 in April 2022. This is over 11% more expensive than March 2021, and £35,000 more expensive than second-placed East Lothian. 

The Orkney Islands, with a fairly modest average house price of £220,000, have seen the greatest change in house prices over the last year, rising by over 34% in the previous 12 months, and a whopping 16% from March 2022. 

Generally speaking, most areas of Scotland have seen a rise in house prices over the last year of between 10-20%. The Shetland Islands incidentally is the only area of Scotland to see a fall in house prices between 2021 and 2022, of -0.6%. 

Inverclyde is the cheapest place, on average, to purchase a house in Scotland. At just over £111,000, this makes the average property about three times less than the City of Edinburgh. Inverclyde has also seen the largest fall in house prices between March and April 2022 of anywhere in Scotland, at -4.5%. 

It is worth noting that the volatility in property prices in certain areas can be affected by low sale volumes compared to other parts of the country. For example, the large price changes in the Shetland and Orkney Islands are likely partially due to lower sales volumes. 

Edinburgh and Glasgow have the highest, and similar, sale volumes across Scotland, yet a house in Edinburgh is around twice the amount of that in Glasgow.

A breakdown of average house prices in Wales
Local authorityAverage house price (£) April 2022Monthly change (from March 2022)Sales volume (December 2021)Annual change (from April 2021)
Monmouthshire346,2910.41,47917.57
Vale of Glamorgan304,037-1.872,17420
Ceredigion259,7241.11,00722.98
Cardiff254,0861.164,44311.35
Powys238,189-0.651,86016.95
Anglesey237,8665.731,06017.51
Pembrokeshire236,1902.481,96019.92
Newport226,8690.312,08012.55
Flintshire207,6572.152,18812.75
Gwynedd204,313-1.421,73613.26
Conwy204,178-1.061,98411.35
Wrexham199,5551.551,73314.87
Carmarthenshire197,079-0.492,69513.67
Denbighshire195,3231.211,3909.25
Bridgend193,2971.772,17010.72
Torfaen192,3582.961,21317.02
Swansea190,5443.083,12615.42
Caerphilly175,6940.352,33014.42
Neath Port Talbot150,707-1.051,92611.33
Rhondda Cynon Taf149,7242.123,41812.34
Merthyr Tydfil147,341-0.1967319.55
Blaenau Gwent131,5962.7691222.74

Throughout Wales, there is also a considerable contrast in house prices. The most expensive area to buy a house, on average, is Monmouthshire with house prices in excess of £346,000. This is £40,000 more expensive than Vale of Glamorgan in second place, and £210,000 greater than the most affordable area, Blaenau Gwent, where house prices are around £131,000. 

Between March and April 2022, the vast majority of Wales saw very little change in average house prices during this period. The exceptions to this were Anglesey, which saw the greatest jump in house prices, by more than 5%, followed by Swansea (3%). The Vale of Glamorgan saw the greatest fall in house prices, by almost 1.9%. 

From April 2021 to April 2022, virtually all of Wales saw double-figure increases in average house prices, apart from Denbighshire (9.25%). Ceredigion and Blaenau Gwent both saw significant rises in property prices, by almost 23% for each area.

However in terms of house sales, there is a more consistent pattern. Most local authorities experienced between 1,000 and 3,000 sales in December 2021, with the exception of Merthyr Tydfil and Blanenau Gwent who had 673 and 912 property sales, respectively. 

Cardiff also had the most amount of property sales, with over 4,400 in December 2021, almost 1,000 more than second-placed Rhondda Cynon Taf. 

A breakdown of average house prices in Northern Ireland
Local authorityAverage house price (£) April 2022Monthly change (from March 2022)Sales volume (Q2 2022)Annual change (from April 2021)
Lisburn and Castlereagh189,9682.735387.88
Ards and North Down187,9474.817179.06
Causeway Coast and Glens183,1104.0340614.82
Newry Mourne and Down176,7963.1242513.47
Antrim and Newtownabbey166,6782.485238.62
Mid Ulster159,6054.3228511.78
Fermanagh and Omagh153,2673.4321613.05
Belfast152,6033.011,1676.75
Mid and East Antrim151,7943.5247711.68
Armagh City, Bambridge, and Craigavon146,5774.7666-
Derry City and Strabane145,7410.83789.41

Of all the regions of the UK, Northern Ireland has the least variation in average house prices. Lisburn and Castlereagh is marginally the most expensive area of Northern Ireland, with average property prices at just under £190,000. Ards and North Down is next on the list, followed by Causeway Coast and Glens, with almost £188,000 and £183,000, respectively. 

Derry City and Strabane is the most affordable area of Northern Ireland. At just over £145,000, this is narrowly the cheapest on average compared to Armagh City, Bambridge, and Craigavon at around £146,500.

Over the last year, all local authorities in Northern Ireland have seen an increase in house prices. Belfast has seen the smallest increase over 12 months, at almost 7%, whereas Causeway Coast and Glens has experienced almost a 15% rise in house prices since April 2021. Yet more properties were sold in Belfast than any other area with over 1,100 in Q2 2022.  

Between March 2022 and April 2022, most areas saw property prices rise between 3 to 4%. Ards and North Down had the greatest increase, at 4.8%, compared to Derry City and Strabane with a relatively small 0.8% rise. Property sales for Q2 2022 were lowest in Fermanagh and Omagh (216) followed by Mid Ulster (285).

UK house prices over time 

A breakdown of average UK house prices over time
Line graph to show how average UK house prices have changed between 2011 and 2021

The growing trend of UK house prices is one that has been happening for some time. According to Nationwide, the average UK house price has grown steadily since 2011, from £162,000 to almost £248,000 in the third quarter of 2021. 

A breakdown of average UK house prices over time in Great Britain
 Line graph to show the average house prices for England, Wales, and Scotland between 2005 and 2021

Since the global financial crisis in 2008, the average property price in Great Britain has been on an upwards trend. This has been happening at a much faster rate in England, compared to Wales and Scotland. 

House prices in England between 2005 and 2021 increased by 42%, compared to 33% in Wales and 44% in Scotland over the same time period. However, in 2005, average house prices in Scotland did start off at almost £94,000, compared to £124,000 and £159,000 in Wales and England respectively. 

Between 2008 and 2016, house prices in Wales and Scotland remained comparatively about the same. However, since 2017, the gap has slowly started to increase. The average Welsh property in March 2021 would set you back about £20,000 more than one in Scotland. 

As of March 2021, the average price of a house in Wales stood at roughly £185,000, and it was £166,000 in Scotland. You would have to go back to August 2013 and July 2009 to find respective comparable house prices in England. 

A breakdown of the 12-month percentage change in UK house prices over time
 A line graph to show the change in 12-month percentage change in UK house prices between 2007 and 2021

Since the start of the Covid-19 pandemic, UK residential property prices have increased dramatically. 

According to the Nationwide Building Society, in the 12 months prior to November 2021, the average price of a house in the UK increased by over 10%. By this point, the average house was just short of £250,000. 

Over the last decade, the annual change in UK house prices has altered considerably. Prices dropped by 9.7 percentage points in July 2009, yet increased by 13.5 percentage points in June 2021, following months of intense fluctuation throughout 2021. 

Average house price by property type 

A breakdown of average house prices in different parts of the UK for different property types 
A graph to show the average house prices for England, Wales, and London in 2021 and 2022, and the percentage change in house prices between those years, broken down by type of property.

In the year up to May 2022, UK house prices increased by 12.8%, up from 11.9% in April 2022. In May alone, this represented the sale of over 109,000 residential properties, with a value of £40,000 or more, compared to almost 115,000 in May 2021. 

In terms of average house prices, London has seen an increase of 8% between May 2021 and May 2022. Conversely, England has seen a 13% increase whereas Wales has seen a 14% rise. Scotland has seen a 16% rise in house prices over this period, compared to just 3% in Northern Ireland. 

Between May 2021 and May 2022, detached properties in England and Wales have both increased by over 15%, the highest of any property types across England, Wales, and London. Detached properties in London still remain the most expensive in the country. In May 2022, this would have set you back over £1 million on average (an 11% rise compared to May 2021). 

Following the changes made by the UK government in September 2022, buyers will not need to pay stamp duty when buying a home that is less than £250,000 in England and Northern Ireland. In most areas, this budget will comfortably buy a terraced property. Further to this, a first-time buyer can also spend up to £425,000 without incurring a stamp duty charge, which is roughly the price of the average flat in London.  

For properties costing more than £250,000, buyers will incur stamp duty fees, however, they are significantly less than prior to the announcement. For example, when purchasing a property costing up to £625,000, stamp duty fees will cost £19,000. This might get you a small, semi-detached property in London. However, for a detached property in London costing  £1 million, stamp duty fees will amount to over £41,000.

A detached property in Scotland has risen 22% over the last year, to around £347,000, compared to £250,000 in Northern Ireland (a rise of 11% between May 2021 and May 2022). 

Across all property types, flats and maisonettes have seen the lowest rise in terms of average prices. In the twelve months leading up to May 2022, these properties rose by 5.5% in London, compared to 8.3% in England, and almost 10% in Wales. In Scotland and Northern Ireland, flat prices are around the same (about £125,000), with the former seeing a 10% rise over the last year and the latter seeing an 8% increase in average prices. 

Actual house prices compared to modelled house prices 

A breakdown of actual UK house prices compared to modelled UK house prices over time
Line graph to show the valuation of UK house prices over time and whether it was over or under-valued each year between 1974 and 2022

As house prices and interest rates continue to rise, the affordability of the UK housing market begins to be brought into question. 

According to the ONS and BoE, as of May 2022, UK house prices were over-valued by around 9%. This is based on a mortgage rate of 1.96%. At a rate of 3%, prices would become 23% over-valued. This will likely result in a drop in house prices, or reduced market activity (at least in the short term). 

UK mortgage affordability statistics 

Prior to August 2022, before being approved for a home loan, potential borrowers had to prove that they could afford their monthly repayments, should interest rates rise by 3%. The BoE has since scrapped this element of the so-called ‘stress test’ for UK mortgage applications. 

The BoE has indicated that between 2014 to 2022, around 35,000 people (approximately 6% of the mortgage borrowers) would have been able to secure a larger home loan, if the interest rate stress test had not been in place. 

New mortgage lending is still set at 4.5 times a borrower’s income, as well as some separate affordability criteria set out by the Financial Conduct Authority (FCA). However, banks can offer more, but only on a set proportion of their total lending. For example, Halifax and Barclays have offered up to 5.5 times the income for high-earning borrowers, whilst mortgage lender Habito will lend up to seven times a borrower’s salary, in some circumstances. 

UK house prices to income over time 

A breakdown of the house prices to earnings ratio in the UK over time 
 Line graph to show how the hose price to earnings ratio has changed in the UK between 2002 and 2018

Between 2002 and 2018, the UK house price to earnings ratio has risen from five to 7.8. This means over this 16-year period, there has been more than a 50% rise in the cost of housing relative to earnings. 

According to the Lloyds Banking Group, in the first quarter of 2022, the average UK house price was just under £280,000. An average UK full-time worker could expect to take home around £39,000 a year, resulting in a house price to income ratio of 7.1.

Regional UK house prices to income

A breakdown of regional house prices in England and Wales in relation to people’s income
Shaded map of England and Wales to depict the ratio of house prices in different regions of the UK in relation to their average income

The house price to income ratio differs depending on which part of the country you are located in. London still remains top of the pile, with house prices almost 15 times more than median earnings in the capital. The South East is the second most expensive place to live in relation to earnings, with a house price to earnings ratio of just over 11. 

Despite all UK areas seeing a rise in their ratios between 2020 and 2021, some have seen a greater, and smaller rise, than others. 

London has seen the biggest change, with house prices almost 1.2 times larger, in relation to income, since 2021. The South West has also seen a relatively significant increase over this 12-month period, with an increase of 1.05 in 2021. 

On the other end of the scale, the North East has seen the smallest increase, and remains the most affordable place in the UK to live, in relation to income levels. This region, along with Wales, are the only areas of the UK where the ratio remains below seven. In real terms, this means, for the vast majority of the UK, a house will cost more than seven times the median salary for that location. 

The ONS revealed that as of 31st March 2021, the average home in England cost the equivalent of 8.7 times the average annual disposable income. They reported that England’s median house price was £275,000, and that the median disposable income was around £31,800. 

By comparison, in Wales, median house prices were £176,000, and income was £29,400. This represented a house price income ratio of 6. This was slightly higher than that of Scotland (5.5), where the median house price was £10,000 less than in Wales, yet median income was almost £1,000 more (£30,300). 

In Northern Ireland, median income stands at around £29,000. With the median house price of almost £169,000, this generates a house price index score of 5.8, meaning house prices are almost six times greater than the average salary.

Mortgage loan statistics: Loan to value (LTV) ratios 

A breakdown of the UK mortgage loan to value ratio (LTV) over time
A stacked line graph to show the loan to value ratio of UK mortgages between 2020 and 2022, and the percentage that falls within each category

In Q1 2022, the share of mortgages with a loan to value (LTV) ratio above 90%, reached 3.9%. This is three times more than the previous year when the rate fell to a low of 1.1%, and was 0.3% lower than the previous quarter (Q4 2021). 

Incidentally, those with LTVs over 95% have remained broadly unchanged since Q4 2021, at 0.2%. 

Alongside this, the share of mortgages advanced with LTVs over 75% has seen a gradual decrease since a peak of 38.8% in Q4 2020. In Q1 2022, the rate stood at 31.6%. A figure this low had not been seen since Q2 2020. 

For mortgages advanced with LTVs of 75% or less, the percentage has remained largely the same since Q2 2020. As of Q1 2022, the rate for these mortgages was 64.5%, a rise of 4.8pp since Q3 2021, the lowest rate in recent years (59.7%).  

Mortgage loan statistics: Loan to income (LTI) ratios 

A breakdown of UK mortgage lending over time, based on level of household incomes
A stacked bar chart to show the percentage of UK mortgages for different income groups in society, between 2020 and 2022.

A startling fact about the UK economy in 2022 is that houses earn more money than people. Since the year 2000, UK house prices have significantly outpaced that of average earnings. 

As of Q1 2022, just under half of lending was to borrowers with a high loan to income (LTI) ratio. These people are defined as single-income households, with an LTI ratio of four or above, or joint-income households with an LTI of three or above. 

This decreased by 0.5% from the previous quarter in 2021 but was 0.1% higher than a year earlier. These loans equated to almost 12% of gross mortgage lending in Q1 2022, which remained broadly the same compared to Q4 2021. 

Single income borrowers with an LTI ratio between 3 to 3.5, and joint income borrowers with an LTI ratio between 2.5 to 2.75, occupy the smallest group in the mortgage lending statistics. 

In Q1 2022, this group accounted for only 6.8% of approved mortgages. This is a drop of 0.4% from the previous quarter and 1.7% down from the highest point in Q2 2020. 

Mortgage statistics around the world 

In terms of mortgage length, 20 or 25-year mortgages used to be the standard. However, in recent years, that has increased to 30 or 35 years, with some lenders even offering 40-year mortgage deals. 

For some countries, longer-term mortgages are the only way to keep the housing market afloat, where prices remain high and wages cannot keep up. 

In Japan, for example, those wishing to get onto the property ladder can be offered a deal known as Flat 35. This is offered by the Japanese Government in conjunction with banks, where people can take out a mortgage until they are 80 years old. 

A 2020 survey by Japan’s health ministry found that 10% of households aged 63 to 72 still had a mortgage, and this is expected to rise into the future. 

Global house price to income ratio

A breakdown of the house price to income ratio across different European countries
A shaded map of Europe to show the house price to income ratios for various European countries, with red shades denoting more expensive areas and green more affordable areas to buy a house.

Overall, in 2021, house prices grew faster than incomes in many countries around the world, making them not exactly the cheapest places in the world to buy a house

The house price to income ratio for the Netherlands was equal to almost 150%, making it one of the world’s most unaffordable places to own a home. This value denotes a ratio of 3:2, meaning for every £2 people earn in the Netherlands, £3 needs to be spent on houses in order to buy them. New Zealand, Portugal, and Luxembourg are all equally as expensive to live, all with ratios of over 140% (£7 on houses for every £5 earned).

A breakdown of the house price to income ratio for a selection of non-European countries
Radial bar chart to denote the house price to income ratio for various non-European countries

In 2021, the UK is placed as the 18th most unaffordable country to own a home in. With an index ratio score of 116, this means for every £25 earned by UK residents, £34 is needed in order to buy a house

UK remortgage statistics

Remortgaging your house can be a way of releasing equity in your property, or simply allowing you to change the provider or terms of your mortgage. 

The number of approvals for remortgages in the UK decreased from 47,200 in May 2022, to 44,000 in June 2022. This also remained below the 12-month, pre-pandemic average of 49,500 up to February 2020.

UK remortgages over time

A breakdown of UK remortgage approvals between 2010 and 2021
A line graph to show the number of approved remortgages in the UK between 2010 and 2021

Between 2010 and 2021, the number of monthly approvals for remortgage loans generally increased. In January 2010, just over 3,000 remortgage loans were authorised, compared to almost 9,400 in August 2018 (an increase of around two-thirds). In the wake of Covid-19, there was a steep drop in the number of remortgage approvals, as they fell to 5,400 in May 2020. However, since then, they have recovered to around 8,700 in September 2021. 

A breakdown of UK homeowner remortgages
 A pie chart to show the number of homeowner remortgages between 2018 and 2019

In the 12 months from July 2018 to June 2019, there were more than 469,000 homeowner remortgages in the UK. Of these, 231,000 (49%) were equity withdrawn remortgages (meaning money was withdrawn), and 238,000 were refinancing remortgages (with no money withdrawn).

UK mortgage repayment statistics 

A breakdown of UK remortgage repayments over time
A comparative line graph showing the amount of money spent on UK mortgage repayments between 2012 and 2021 for redemptions, lump sump repayments, and the total amount

Between 2012 and 2021, the quarterly amount of repayments for the secured loans on UK dwellings steadily increased, reaching £13.3 billion in Q3 2021. These figures include all home purchase loans and remortgaging. The lowest point in the previous decade was in Q3 2012, when the value stood at almost £8.2 billion (about 60% less compared to 2021). In the second half of 2020, repayments dropped to £10.7 billion as a direct reaction to Covid-19 (figures not seen since the end of 2013). 

In real terms, this meant that UK households were typically spending an average of £28.20 a week on their capital repayment of mortgages. 

UK mortgage repayments on redemption fees

Redemption charges refer to the early repayment fees that a borrower must pay if they wish to repay their loan back earlier than the final repayment date. Between 2012 and 2021, the value of repayments on the redemption of secured loans on UK dwellings generally increased, with some significant fluctuations. 

As of Q3 2021, this value stood at £38.5 billion. Back in Q1 2012, £20.8 billion was paid in early repayment charges, rising to a peak of £43.2 billion in 2018 (an increase of over 50%). Expectedly, the amount repaid did drop in Q2 2020, to approximately £10 billion below the same period in 2019. 

Lump sum repayments on UK mortgages

Lump sum repayments is when a mortgage borrower decides to pay extra off their mortgage, in addition to the standard monthly payment. Since 2012, the value of mortgage repayments in the UK has generally increased, in between periods of stagnation or fluctuation. As of Q3 2021, the amount of repayments stood at £5.3 billion, marginally down from a peak of £5.8 billion in Q1 2021. 

An expected drop occurred in Q2 2020, but soon picked up again over the subsequent months of 2020 at rates not experienced since 2015/16. 

The impact of Covid-19 on the UK mortgage market

The Covid-19 pandemic affected the lives of millions of UK residents. Whether directly or indirectly, one of those has been the mortgage market. 

A breakdown of how Covid-19 has affected the UK mortgage market
 An infographic to show how Covid-19 has affected the UK mortgage market

The number of residential mortgage approvals plummeted during 2020, going from almost 73,500 in February to just under 9,500 in May. The rebound of this was a surge in the market, up to 103,000 in November alone. 

By comparison, the number of house purchases as a percentage of mortgage approvals dropped to 55% in Q2 2020, and then rose to 75% in Q4 2020 and beyond. 

Unsurprisingly, this also led to a rapid decline in mortgage lending. According to HMRC, there were almost 95,000 transactions in February 2020. By April, this had more than halved to around 41,500. In response to this, the market soared in June 2021, reaching over 208,000. The BoE reported similar trends, going from 72,000 in February 2020, to a mere 9,290 in May 2020, before rising to over 105,000 in November 2020. 

As a result, the value of mortgage lending also dropped. In 2019, this was around £276 billion, before dropping to just under £250 billion in 2020. In 2021, the market was thriving once more, generating in excess of £315 billion. 

When broken down by quarterly lending on mortgages, the numbers are even more profound. In Q4 2019, this figure was around £73 billion. By Q2 2020, it had declined to £44 billion, before increasing a year later to over £89 billion in Q2 2021. 

Other economic factors in the UK mortgage market also took a hit before seeing a resurgence. Prior to the Covid-19 pandemic, the value of secured lending on UK dwellings stood at £24.4 billion. By April 2020, this fell by almost two-thirds, to £9.4 billion, before restoring to £27.7 billion in October 2020.  

The value of gross lending by building societies also took a hit, dropping by almost 50% between October 2019 and April 2020, from £5.6 billion to almost £3 billion, respectively. By October 2020, the numbers had risen back up to around £5.4 billion as the market started to recover. 

The value of UK mortgages as a whole was severely impacted by the coronavirus pandemic, falling from over £40 billion in Q1 2020 to just under £25 billion three months later. In Q2 2021, this figure soared to over £69 billion. Despite all of this, the average weekly wage only fell by around £15 a week between the first quarters of 2020, from £544 to £528. By Q2 2021, people were earning on average over £575 a week, around £50 a week more compared to the previous year.

A breakdown of how Covid-19 has affected UK remortgages
An infographic to highlight the ways in which Covid-19 has affected remortgages in the UK

Despite this, mortgages with arrears were also impacted due to Covid-19, with the number of new commitments falling in Q4 2020 from £87.7 billion to £77.4 billion. 

Those looking to remortgage in 2020 also took a hit. Of the total mortgages in arrears, remortgaging occupied nearly 38% in Q2 2020 yet only 16.5% in Q2 2021. Conversely, home movers constituted 23% and rose to 42% in the same period. The number of remortgage approvals fell by 40% in 2020, going from just over 9,000 in February to 5,400 in May. 

With a slightly more positive spin, the number of UK mortgage repossessions fell dramatically between 2019 and 2020, from over 35,000 to around 8,600, whereas mortgage fraud rates decreased by more than 0.1% over the same time period. This has since increased back to pre-pandemic levels at around 0.6%.  

UK mortgage holidays 

A mortgage payment holiday is an agreement made between a mortgage lender and borrower, to temporarily stop or reduce monthly repayments. Over 1.6 million mortgage payment holidays were offered to homeowners impacted by Covid-19, meaning roughly one in seven UK mortgages were subjected to a payment holiday. 

By comparing mortgage holidays between 25th March 2020 and 8th April 2020, we can see that the numbers had more than tripled, growing from 390,000 to just over 1.2 million, with around 61,000 being authorised per day. In April 2020 alone, almost 700,000 were granted to UK mortgage holders, amounting to around £755 per month of suspended payments. 

As of May 2020, this has risen to 1.82 million payment holidays, meaning one in six UK mortgages were now covered by relief in repayments. 

By December 2020, 130,000 deferrals had been put into place. This resulted in one in 84 mortgages being subjected to a payment holiday, as people began their financial recovery from the coronavirus pandemic. 

By the end of 2020, eight in 10 customers had returned to making their full, normal monthly repayments.

Uswitch.com mortgage survey (August 2022)

We polled 2,007 adults around the UK aged 18 and over to find out how they feel about mortgages, their current repayments, outstanding arrears, the value of their property, and more. 

Please note: As with any survey, there is always the potential for human error and misunderstanding of questions which could potentially skew results

Mortgage repayment by industry

IndustryAverage monthly salary of industryPrice of houseMonthly mortgage repayments% of salary spent on mortgage% of employees up-to-date with repayments but unable to switch% of employees who have somewhat struggled
Arts & Culture£2,487£198,664.43£874.7035.17%90.48%38.10%
Travel & Transport£4,598£183,043.14£777.9516.92%84.13%47.62%
HR£3,198£218,000.00£1,259.9639.40%84.00%76%
Manufacturing & Utilities£4,108£205,015.48£816.2819.87%83.78%36.04%
Retail, Catering & Leisure£2,747£162,299.54£769.9128.03%80.92%40.13%
Finance£3,480£230,344.41£1,074.6730.88%78.17%45.07%
IT & Telecoms£5,989£240,213.71£1,110.9818.55%76.86%59.50%
Healthcare£1,495£196,821.53£830.6455.56%76.60%39.01%
Architecture, Engineering & Building£2,188£265,104.17£1,049.9647.99%75.00%45.83%
Sales, Media & Marketing£1,954£227,169.46£1,172.9660.03%75.00%55.77%
Education£2,934£203,108.14£853.7029.10%73.56%35.87%
Legal£2,145£224,090.91£851.6339.70%52.73%54.55%

Those working in HR pay more on their monthly mortgage repayments than any other industry. At almost £1,260 per month, this was almost £100 a month more than the next highest (Sales, Media, and Marketing) at around £1,173. As a percentage, however, HR repayments were just over 39% of their average monthly salary. 

Even though Sales, Media, and Marketing pay less than HR per month on their mortgage, this is in fact over 60% of their average monthly take home. Healthcare workers have the lowest average monthly salary of all the sectors in our study, at just under £1,500. This means they are using over 55% of their wages in order to keep up with mortgage repayments.  

Those working in IT and Telecoms have the highest average monthly salary out of all the professions, at almost £6,000. Despite having a moderately large monthly mortgage repayment, this equates to just under 19% of their salary (the second lowest in our study behind Travel and Transport at almost 17%).

Over 90% of those in the Arts and Culture industry were up-to-date with their mortgage repayments, but were unable to switch, compared to just over half of those in the legal sector. 

In terms of those who have struggled with mortgage repayments, over three-quarters were in HR, with almost 60% in IT and Telecoms. Those in Education actually fared the best in terms of keeping up with repayments, with almost 36% saying they have found it difficult to maintain their monthly mortgage payments.

Young buyer statistics compared to other age groups 

Young buyer mortgage repayments compared to other age groups
Age 18-24 %Age 25-34 %Age 35-44 %Age 45-54 %Age 55+ %
Less than £5005.94%22.59%23.26%27.95%37.70%
£500 - £99931.68%54.82%52.71%51.81%42.62%
£1,000 - £1,49922.77%12.79%12.87%9.88%9.43%
£1,500 - £1,99910.89%4.49%4.50%3.13%2.05%
£2,000 - £2,4999.90%1.99%1.55%0.24%0.41%
£2,500 - £2,99910.89%1.66%1.09%0.48%1.23%
£3,000 or more, please specify in £0.99%0.33%0.00%0.48%0.41%
Unsure6.93%1.33%4.03%6.02%6.15%

In terms of monthly mortgage repayments, those aged 18 to 24 pay considerably more each month compared to other age groups. According to our study, the mean average for 18 to 24 year olds is £1,390 per month (almost the same amount as 45 to 54 and the over 55s combined). By contrast, those aged 25 to 34 and 35 to 44 pay on average around £850 to £875 per month on their mortgages. 

When broken down by amount, under 6% of 18 to 24 year olds pay less than £500 per month on their mortgage, compared to almost 38% of those over 55. 18 to 24 year olds also had the least proportion of people with payments between £500 and £999 per month, at just under 32%, compared to almost 55% for those between 25 to 34. 

Over a fifth of 18 to 24 year olds have payments between £1,000 and £1,499 (the most of any age group). This is almost double that for the 25 to 34 and 35 to 44 age groups. In contrast, less than 10% of those between 45 to 54 and over 55 have a payment in this bracket. 

Astonishingly, 18 to 24 is the most popular age group for all other payment categories. Over 10% have payments between £1,500 and £1,999, as well as £2,500 to £2,999. One person aged 18 to 24 from our study even had monthly repayments of over £3,000, compared to two in the 25 to 34 and 45 to 54 age groups.

Total number101Total number602Total number645Total number415Total number244
Age 18-24 %Age 18-24 CountAge 25-34 %Age 25-34 CountAge 35-44 %Age 35-44 CountAge 45-54 %Age 45-54 CountAge 55+ %Age 55+ Count
1 = Have not struggled at all30.69%3156.98%34360.47%39059.76%24861.48%150
2 = Have struggled a little42.57%4331.56%19028.06%18126.27%10922.54%55
3 = Have struggled16.83%177.64%467.44%487.47%3110.25%25
4 = Have really struggled6.93%72.49%152.48%165.30%224.92%12
Unsure2.97%31.33%81.55%101.20%50.82%2

As the cost of living in the UK continues to rise, one of the areas that people are concerned about is whether they can keep up with monthly mortgage repayments. 

Over the past 12 months, those in the 18 to 24 age bracket have struggled more than any other age group to repay their mortgage each month. Less than a third of 18 to 24 year olds claim to have not struggled at all with this over the previous year, compared to around 60% for each of the other age groups. 

Conversely, almost 43% of 18 to 24 year olds have struggled a little to pay their mortgage each month, compared to almost a third of 25 to 34 year olds, and less than 30% for those between 35 and 55 years of age. 

Almost 17% of those aged 18 to 24 admitted to struggling, with just under 7% claiming to have really struggled (the most out of all the age groups). 

Young buyer mortgage lengths compared to other age groups 

The vast majority of people from our survey took out a 25 year mortgage. This was around a quarter of those aged 18 to 24, compared to around 64% for 45 to 54 year olds and 56% for the over 55s. 

Nearly 17% of 18 to 24 year olds had an original mortgage of less than 25 years (the second highest group after the over 55s with almost 29%). Just 8% of 35 to 44 year olds had a mortgage of less than 25 years. 

Conversely, those aged 18 to 24 were the most popular age group for mortgages lengths between 26 to 29 years. 

Almost 16% of 18 to 24 year olds had a 30 year mortgage, compared to 19% for 25 to 34 year olds and 18% for 35 to 44 year olds, yet only 7% had a mortgage of 35 years. 

Incidentally, the only age group to not have a mortgage of 39 years or more was the 18 to 24 bracket.

Age 18-24 %Age 25-34 %Age 35-44 %Age 45-54 %Age 55+ %
less than 25 years16.83%6.31%8.37%15.42%28.69%
25 years25.74%28.07%44.03%63.61%56.15%
26 years8.91%1.99%1.40%1.20%0.00%
27 years4.95%1.83%3.26%2.17%0.00%
28 years3.96%3.32%2.02%1.45%1.23%
29 years3.96%1.33%0.93%1.45%0.41%
30 years15.84%19.44%18.14%8.19%5.74%
31 years0.99%1.16%0.31%0.24%0.00%
32 years0.99%2.99%1.24%0.48%0.00%
33 years0.00%2.33%1.24%0.48%0.00%
34 years0.99%1.00%0.78%0.00%0.00%
35 years6.93%18.77%9.92%1.20%0.41%
36 years0.99%0.50%0.16%0.00%0.00%
37 years0.99%0.50%0.47%0.24%0.00%
38 years0.99%0.50%0.62%0.00%0.00%
39 years0.00%0.83%0.78%0.00%0.00%
40 years0.00%6.31%1.09%0.48%0.00%
More than 40 years0.00%0.17%0.31%0.24%0.41%

The future of UK mortgages 

It is likely that there will be future growing pressure on UK homeowners, as the BoE continues to increase interest rates to curb rising inflation. It is estimated that over the course of 2022 and 2023, mortgages could increase by as much as 40%. 

As of August 2022, the UK property market is beginning to slow down due to a rise in borrowing costs, and the anticipation of further hikes. Capital Economics forecasts that UK house prices could drop by as much as 10% in order to combat the rising interest rates.

20% of UK mortgages are floating (one that is subject to daily market fluctuations), so these borrowers will feel the rising interest rates almost immediately. Of the remaining 80% that are fixed, around a quarter of them will expire by August 2023. This means from the 100% stock of mortgages, about 40% will see higher rates before the end of 2022. 

The BoE has said that whilst UK households will feel the pinch in the coming months, it will not be as bad as the global financial crisis of 2008.

Timeline of UK mortgage updates

February 2nd 2023: BoE raises interest rates further to 4%

An increase in the base rate from 3.5% to 4% means that tracker rate mortgage customers will pay around £49 a month more, compared to a rise of £31 a month for those with a SVR mortgage. This is on top of increases following previous rate rises. 

Compared to December 2021, the average tracker mortgage will cost £382 more per month, with variable mortgages seeing a monthly increase of £240.

November 3rd 2022: BoE raises interest rates to 3% 

In a bid to tackle soaring prices, the BoE has increased interest rates further to 3%. This is the eighth consecutive rise since December 2021, and the highest level for 14 years. 

Around 1.6 million people on tracker deals will see an immediate rise in their repayments, of around £73.50 a month, while those on a variable rate package face a jump of £46 per month. 

The average tracker rate mortgage customer will be paying £284 a month more compared with the same deal prior to December 2021, whereas those on a variable rate are paying an extra £179 per month. 

House-buyers, or anyone looking to remortgage, will now have to pay a lot more now, than if they had taken out the same mortgage a year ago.  

August 4th 2022: UK government raise interest rates from 1.25% to 1.75%

The BoE’s decision to raise interest rates by 0.5% is the largest increase since 1995. The last time interest rates were this high, December 2008, was just after the global financial crisis. 

According to the English Household Survey, just under a third of UK households have a mortgage. Of these, about 75% have a fixed-rate, so are not immediately affected. The rest (about two million people) will see an increase in their monthly repayments. 

According to UK Finance, 21% of households are on a variable rate mortgage (approximately 800,000 on a tracker mortgage and 1.1 million on a standard variable rate (SVR)).

A tracker mortgage directly follows the BoE base rate. To put it into context, a 2.5% rate would rise to 3%. If you had a £150,000 mortgage with 20 years remaining, this would add £38 per month to your repayments. Compared to this, the SVR will change at the lender’s discretion. 

Of the nine million outstanding UK mortgages, about 1.3 million are due to end during 2022, although this does include those from January 2022—many of which would have been sorted out before the changes to interest rates came in. 

August 1st 2022: Scrapping of the stress test for mortgage affordability 

Rules for would-be mortgage borrowers were relaxed from the 1st August 2022, as lenders no longer need to apply compulsory affordability tests.

Under the BoE rules, banks and building societies were compelled to calculate whether prospective borrowers could afford their mortgage (re)payments if the interest rate they were being offered was to rise by three percentage points (pp) during the initial five years of their mortgage. 

These rules were introduced in 2014 and later revised in 2017. However, between 2017 and 2021, interest rates only rose on average by 0.5pp. This raised concerns that the 3% stress test was too high. 

Instead, from 1st August 2022, lenders will base their calculations on forecasted interest rates. However, the BoE has stipulated that this must include a minimum buffer of at least 1pp above the borrower’s original mortgage rate.

July 8th 2022: First Direct launches a 10-year fixed rate mortgage with unlimited overpayments 

In response to the growing demand for more security surrounding household finances, First Direct has launched a new 10-year fixed rate mortgage plan. 

Borrowers are allowed to make unlimited overpayments during this period without incurring a penalty (which lenders normally cap at 10% of the outstanding loan each year). 

Interest rates on the 10-year mortgage are set between 3.34% and 3.69%, depending on the deposit borrowers have. The maximum loan size was also capped at £550,000 worth of borrowing. It is also available to first-time buyers, home movers, remortgagers, and those looking to borrow additional funds. The term has also been extended to a maximum of 40 years. 

First Direct has now joined other high-street mortgage lenders, including Halifax, TSB, and Lloyds, by offering an appealing 10-year fixed rate mortgage package, as borrowers seek long-term financial security amidst a cost of living crisis and rising interest rates. 

July 4th 2022: Mortgage deals introduced for Help to Build government scheme 

The ‘Help to Build’ scheme, which is available only in England, offers home-builders an equity loan between 5% and 20%, providing they have a deposit of at least 5%. This applies to self or custom home-builders (i.e. those building on an existing property) and, if located in London, can receive an equity loan up to 40%, as long as the 5% deposit is still met. 

The remaining 95% must be funded with a self-build mortgage from a registered lender within the scheme. Mortgages are offered on an interest-only basis for the duration of the build, which must not exceed three years. After work is complete, it will switch to a repayment package.  

However, borrowers can’t use the loan towards the cost of the build itself, as the funds are paid directly to the lender once the building is complete. 

The purpose of the equity loan is to reduce the amount being borrowed on the mortgage. Repayments will begin at the same time as the mortgage repayments and work very much like the Help-To-Buy scheme, which is due to end in March 2023.

For the first five years, repayments will be interest-free, after which interest is charged at 1.75%. Repayments will increase every April based on the Consumer Prices Index (CPI) measure of inflation plus a further 2%. As of June 2022, this stands at a 40-year high of 9.1% and is expected to rise throughout 2022. 

Borrowers can pay back the equity loan at any time after the building has finished. However, it must be repaid in full by the end of the mortgage term, or if the property is sold (whichever happens sooner). 

As it is an equity loan, the amount to be repaid grows in relation to the property value. So if the property goes up in value, you have to pay back more than initially borrowed. 

The Help-to-Build scheme is not only available to first-time buyers, but also to those who exclusively live in the newly-built home. You cannot use the scheme to upgrade a home you already reside in. Planning permission is also needed prior to an application, for any land you intend to build on. 

June 23rd 2022: Rising cost of living and mortgage repayments 

As the cost of living in the UK continues to rise, this will undoubtedly have an impact upon peoples’ ability to repay their mortgage each month.  

According to a 2022 Uswitch survey of 2,007 people in the UK with a mortgage, over 40% of people struggled to some extent in keeping up with their mortgage repayment over the last 12 months. Almost 58% said they had not struggled at all, with 29% stating they had struggled a little. 8% said they have struggled somewhat whilst 3% claimed to have really struggled. 

Remortgaging could save households up to £4,000 a year, compared to staying on the standard variable rate (SVR) offered by their lender. As of June 2022, around 800,000 UK homeowners are currently on an SVR, and only 10% of these have checked whether they are eligible to remortgage. 

June 16th 2022: Rise in UK Base Rate (BR) to 1.25%

On 16th June 2022, the BoE raised  the UK BR to 1.25%, much to the dismay of homeowners and potential buyers across the country. 

This affected those on a tracker mortgage deal as it’s linked to the BR. This means an almost instantaneous rise in monthly mortgage repayments for these borrowers. Those

on discounted deals or their lender’s SVR were also likely affected, as these are influenced by the BR.

For a £200,000 variable rate mortgage priced at 2.5%, the 0.25 percentage point rise will add about £26 to monthly repayments. However, consecutive increases since December 2021 will have added over £100 a month onto the same mortgage, or £1,200 across the year. 

Homeowners who are part-way through their current fixed-term rate will be temporarily unaffected by these increases. But when the deal ends, they will likely be faced with much higher mortgage costs.

Methodology and sources

Creative Commons
Creative Commons