Mortgage rates have been hiked again as the United Kingdom is heading towards a “big reset”.
The rate is closing in on six per cent under a two-year fixed deal.
The change is expected to result in 2.6 million paying thousands of pounds extra annually by the end of the year.
Interest rates are also expected to continue to rise as the Bank of England looks to double-down on efforts to curb inflation.
The change is expected to result in 2.6million paying thousands of pounds extra annually by the end of the year
PAThe move will likely put even more of a squeeze on Britons as the cost-of-living crisis continues to grip the nation.
The average mortgage rate on a new two-year deal today stood at 5.86 per cent.
It was 5.83 per cent last Friday and 5.33 per cent a month ago.
Five-year deals also witnessed an increase to 5.51 per cent today.
Homeowners have seen their mortgage rates surge in recent weeks
PAThe lengthier contract was just above five per cent a month ago.
However, the number of mortgage products available continued to fall.
Data provided by financial experts at Moneyfacts revealed just 4,952 mortgage products were available today, falling from 5,300 a month ago.
Experts in the City have warned that the UK is facing a “big reset of mortgages” after just a third of borrowers on cheap fixed-term deals came off them.
Persistently high inflation rate could lead the Bank of England to hike interest rates for the thirteenth consecutive timePAA source from the Square Mile told The Times: “There's going to be a big reset of mortgages for the next nine months.
“Only a third has come through so far, two thirds is to come.”
Research by Capital Economics indicated 3.2 million of these households are on a rate of at least three percent.
The figure is expected to rise to 5.8 million by the end of the next year.
The housing market remains volatile after worse-than-expected inflation figures released last month put the Consumer Price Index at 8.7 per cent.
Research by Capital Economics indicated 3.2million of these households are on a rate of at least three percent
PATraders anticipate the Bank of England to hike the base rate to 5.5 per cent by the end of the year.
Interest rates currently sit at 4.5 per cent but the Bank will provide its next update on June 22.
The rise in mortgage rates is set to cost borrowers £9billion over this year and next, the Centre for Economics and Business Research has said.
The Financial Conduct Authority has also reported that around 116,000 borrowers are due to come off fixed rate deals this month.
Property website Rightmove even indicated rates have increased across home loan deals by an average of 0.39 per cent over the past week.
You may like
