Average mortgage interest rate in the UK 2010-2023, per quarter

Mortgage interest rates in the UK were on a downward trend for more than a decade before soaring in 2022. In the second quarter of 2023, the average weighted interest rate stood at 4.56 percent - nearly three times the Interest rate in the fourth quarter of 2021. 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 nearly 61 billion euros in gross residential mortgage lending as of the second quarter of 2023. When comparing the total outstanding residential mortgage lending, the UK also ranks first with about 1.9 trillion euros.