Continued interest rate rises have resulted in a £71.50 increase in the average monthly cost of a mortgage for homebuyers across the UK this year, new analysis has found.

Research by Revolution Brokers looked at the increasing cost of a mortgage, based on variable rate mortgages taken out in December 2021, and the changing cost based on increasing rates in comparison to the remaining loan left to pay.

The findings revealed that back in December 2021, the average house price paid by a mortgage-backed homebuyer was £282,038. After putting down the average UK deposit of 15%, worth £42,306, they were taking out mortgages amounting to £239,732. With an average mortgage rate of 3.61%, Revolution Brokers’ analysis showed that the average homebuyer using a standard variable mortgage was paying £1,214.35 per month. 

In the months since, however, the base rate has increased by 1% and pushed the average mortgage rate up to 4.25%. As a result, monthly payments on the average variable rate mortgage have increased to £1,285.85, an increase of £71.50.

The biggest regional increase has been seen in London, with payments in the capital increasing this year by an average of £128.97 per month.

Revolution Brokers founding director, Almas Uddin, commented: “These payment increases are significant, to say the least. A national increase of more than £70 per month means that hundreds of thousands of households will have seen their disposable income squeezed even further, during what is already a very tough time. 

“Variable rate mortgages always come with a modicum of risk as it’s difficult, sometimes impossible, to predict what economic ups and downs are on the horizon.

“The coming months could be very difficult for the average homeowner, as interest rates look set to keep rising, putting even further pressure on our finances in the process.”

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