Mortgage interest rates in the UK were on a downward trend for more than a decade before soaring in 2022. In the first quarter of 2025, the average weighted interest rate stood at **** percent — nearly ***** times the interest rate in the first quarter of 2022. Mortgage rates also vary depending on the type of mortgage: Historically, fixed rate mortgages with a shorter term had on average lower interest rates. What types of mortgages are there? In terms of the type of interest rate, mortgages can be fixed and variable. A fixed interest rate is simply a mortgage where the rate of repayment is fixed, while a variable rate depends on the lender’s underlying variable interest rate. Furthermore, mortgages could be for a house purchase or for refinancing. The vast majority of mortgages in the UK are fixed rate mortgages for house purchase, and only a small share is for remortgaging. How big is the UK mortgage market? The UK has the largest mortgage market in Europe, amounting to over ** billion euros in gross residential mortgage lending as of the fourth quarter of 2024. When comparing the total outstanding residential mortgage lending, the UK also ranks first with about *** trillion euros.

This statistic displays the average household amount outstanding on mortgages from 2006 to 2019 in the United Kingdom (UK). As displayed, the average outstanding amount went from ******* British pounds per household to ******* British pounds. Overall the graph shows a steady increase in the amount owed per household on average.

Mortgage rates surged at an unprecedented pace in 2022, with the average 10-year fixed rate doubling between March and December of that year. In response to mounting inflation, the Bank of England implemented a series of rate hikes, pushing borrowing costs steadily higher. By October 2025, the average 10-year fixed mortgage rate stood at **** percent. As financing becomes more expensive, housing demand has cooled, weighing on market sentiment and slowing house price growth. How have the mortgage hikes affected the market? After surging in 2021, the number of residential properties sold fell significantly in 2023, dipping to just above *** million transactions. This contraction in activity also dampened mortgage lending. Between the first quarter of 2023 and the first quarter of 2024, the value of new mortgage loans declined year-on-year for five consecutive quarters. Even as rates eased modestly in 2024 and housing activity picked up slightly, volumes remained well below the highs recorded in 2021. How are higher mortgages impacting homebuyers? For homeowners, the impact is being felt most acutely as fixed-rate deals expire. Mortgage terms in the UK typically range from two to ten years, and many borrowers who locked in historically low rates are now facing significantly higher repayments when refinancing. By the end of 2026, an estimated five million homeowners will see their mortgage deals expire. Roughly two million of these loans are projected to experience a monthly payment increase of up to *** British pounds by 2026, putting additional pressure on household budgets and constraining affordability across the market.

This statistic illustrates the average house price for equity release plan customers in the United Kingdom (UK) from the second half of 2015 to the second half of 2019, by type of lifetime mortgage. Equity release plans are designed to allow homeowners to access some of the value of their property without the need to sell their house and move out. A lump sum equity release plan facilities a one-off payment, whilst a drawdown equity release plan enables a homeowner to receive an initial advance, alongside an agreed amount cash facility that can be used when required. It can be seen that the average house price for both lump sum and drawdown customers increased steadily during this period, reaching over *** thousand British pounds in lump sum plans, and *** thousand British pounds in the drawdown plans, as of the second half of 2019.

Median price paid for residential property in England and Wales by property type and electoral ward. Annual data.

Affordability ratios calculated by dividing house prices by gross annual residence-based earnings. Based on the median and lower quartiles of both house prices and earnings in England and Wales.

Despite the Office for National Statistics (ONS) reporting that the actual average deposit required to buy a home was ** thousand British pounds (GBP), Santander's survey of potential first-time homeowners found the average target deposit was in some cases much lower. Even in London, where the average property price in early 2019 was over *** thousand British pounds, potential first-time homeowners had a target deposit of around **** percent of the property price (**** thousand GBP).

The issue with having a lower deposit for a new home is that it puts buyers into a higher loan-to-value mortgage ratio. Those in the North East looked to achieve the highest deposit to property price ratio at ******* percent.

In 2022, house price growth in the UK slowed, after a period of decade-long increase. Nevertheless, in June 2025, prices reached a new peak, with the average home costing ******* British pounds. This figure refers to all property types, including detached, semi-detached, terraced houses, and flats and maisonettes. Compared to other European countries, the UK had some of the highest house prices. How have UK house prices increased over the last 10 years? Property prices have risen dramatically over the past decade. According to the UK house price index, the average house price has grown by over ** percent since 2015. This price development has led to the gap between the cost of buying and renting a property to close. In 2023, buying a three-bedroom house in the UK was no longer more affordable than renting one. Consequently, Brits have become more likely to rent longer and push off making a house purchase until they have saved up enough for a down payment and achieved the financial stability required to make the step. What caused the recent fluctuations in house prices? House prices are affected by multiple factors, such as mortgage rates, supply, and demand on the market. For nearly a decade, the UK experienced uninterrupted house price growth as a result of strong demand and a chronic undersupply. Homebuyers who purchased a property at the peak of the housing boom in July 2022 paid ** percent more compared to what they would have paid a year before. Additionally, 2022 saw the most dramatic increase in mortgage rates in recent history. Between December 2021 and December 2022, the **-year fixed mortgage rate doubled, adding further strain to prospective homebuyers. As a result, the market cooled, leading to a correction in pricing.

This statistic shows the average house prices in London, United Kingdom (UK), from 2013 to 2019. The average house price in the capital increased to over *** thousand British pounds by 2019.

Due to interest rates decreasing in recent years, mortgages in the United Kingdom have become overall more affordable: In 2007, when mortgages were the least affordable, a home buyer spent on average **** percent of their income on mortgage interest and *** percent on capital repayment. In 2019, the year with the most affordable mortgages, mortgage interest accounted for *** percent and capital repayment was **** percent of their income. As interest rates increase in response to the rising inflation, mortgage affordability is expected to worsen. Though below the levels observed before 2007, the total mortgage repayment between 2022 and 2026 is expected to exceed ** percent of income.

Summary of UK House Price Index (HPI) price statistics covering England, Scotland, Wales and Northern Ireland. Full UK HPI data are available on GOV.UK.

Housing Index in the United Kingdom increased to 517.10 points in October from 514.20 points in September of 2025. This dataset provides - United Kingdom House Price Index - actual values, historical data, forecast, chart, statistics, economic calendar and news.

United Kingdom Average House Prices: Scotland data was reported at 154,648.000 GBP in May 2020. This records an increase from the previous number of 153,945.000 GBP for Apr 2020. United Kingdom Average House Prices: Scotland data is updated monthly, averaging 133,444.000 GBP from Jan 2005 (Median) to May 2020, with 185 observations. The data reached an all-time high of 155,141.000 GBP in Sep 2019 and a record low of 93,554.000 GBP in Feb 2005. United Kingdom Average House Prices: Scotland data remains active status in CEIC and is reported by HM Land Registry. The data is categorized under Global Database’s United Kingdom – Table UK.EB016: Average House Prices: HM Land Registry.

Forecast mean loan outlay per academic year per higher education undergraduate student, by loan product across 2019/20 to 2027/28

Affordability ratios calculated by dividing house prices by gross annual workplace-based earnings. Based on the median and lower quartiles of both house prices and earnings in England and Wales.

The benchmark interest rate in the United Kingdom was last recorded at 4 percent. This dataset provides - United Kingdom Interest Rate - actual values, historical data, forecast, chart, statistics, economic calendar and news.

Business mortgages, or buy-to-let (BTL) mortgages, are a loan sold to property investors, rather than to people who want to purchase a home to live in. Landlords can apply for a BTL mortgage either as an individual or as a Limited Company. As of the fourth quarter of 2019, the average loan amount of both completed and newly submitted applications by Limited Companies was lower than the average loan to individuals.

The interest rates of most types of personal loans in the United Kingdom (UK) have increased slightly in 2024. However, the interest rates applied to personal loans of 3,000 British pounds were slightly lower than in the previous year, amounting to ***** percent. Smaller personal loans had, in general, higher interest rates than bigger loans.