Mortgages are one of the many areas that have been thrown into disarray as a result of the government’s mini-budget at the end of September.
A renowned think tank has now warned that annual mortgage payments for five million homeowners could climb by an average of £5,100 between now and the end of 2024.
In total, mortgage payments are set to rise annually by £26bn over the next two years, according to the Resolution Foundation.
Affected households in London will see the biggest increase, with average payments projected to rise by £8,000 over this period – more than twice the level of the £3,400 increase experienced by households in Wales.
The impact in London will be concentrated, however, as less than a fifth (19%) of households, there has a mortgage.
“Households across Britain are currently living through an inflation-driven cost-of-living crisis as pay packets shrink and energy bills rise,” said Lindsay Judge, research director at the Resolution Foundation.
“With almost half of all mortgagor households on course to see their family budgets fall by at least 5% from higher payments, the living standards pain from rising interest rates will be widespread.”