- Fixed mortgages rates in the UK have risen to a 7-month high.
- Brits are now paying thousands more per year than Europeans for new mortgages.
Financial data provider Moneyfacts has reported that the average 2-year fixed residential mortgage rate has risen to from 6.19% on Friday, to 6.23%.
The average 5-year fixed residential mortgage rate has climbed from 5.83% up to 5.86% – the highest since the end of November.
These higher rates arrived after the Bank of England increased interest rates last Thursday, lifting the Bank Rate to a 5% – its highest point in 15 years. The move came as a surprise to many, with borrowers now feeling extreme pressure.
The Labour party released an analysis that seemed to show how even before last week’s rise in UK interest rates, homeowners in Britain are paying thousands of pounds more than that of Europeans for new mortgages.
For a £200,000 loan paid back over 25 years, mortgage payments are over £2,000 more per year than in France, £1,100 higher than in Belgium and Ireland, and roughly £800 more than in Germany and the Netherlands.
The analysis is based on Bank of England data which shows that effective interest rates on new mortgages in April were on average 4.46 per cent. European Central Bank figures show that equivalent interest rates were on average 2.91 per cent in France, 3.61 per cent in Belgium, and 3.89 per cent in Germany.
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