Mortgage rates increase by 40% in one year
The latest data from the Bank of England revealed that overall average mortgage rates for new business increased again in August 2022, rising by more than 8%
What the Bank of England said
The average floating mortgage rate for new business 2.77%
The average fixed mortgage rate for new business 2.55%
The average overall mortgage rate for new business 2.56%
Following the mini-budget, it is difficult to keep up with events in the mortgage market. As is clear from the chart above, mortgage rates were rising before the mini-budget and those rises are likely to accelerate from here.
During August average mortgage rates increased by around 10% and were 40% higherthan they were one year ago.
Whilst the data for August is interesting and the data for September will tell us more, all eyes will be on the data for October which will include the first impact on mortgage rates of last week's mini-budget.
We have entered a period of extreme uncertainty in the mortgage market, with several lending temporarily ceasing to offer mortgages to new customers and most lenders significantly reducing the number of mortgages on offer. The mortgage rates available in August are unlikely to be readily available for a long time
Worried about your mortgage payments?
In these challenging times, increasing numbers of homeowners are worried about how they will be able to afford their mortgage as interest rates rise. You can use our mortgage calculator to see how a change in mortgage rates might impact you
We have also put a guide together looking at ways you can reduce your monthly mortgage payments