Mortgage interest rate in the United Kingdom 2010-2022

Mortgage interest rates in the United Kingdom (UK) have been decreasing since 2010 reaching record low levels in the fourth quarter of 2021 at 1.57 percent. A significant increase to 2.59 percent was then recorded by the third quarter of 2022. Interest rates also vary depending on the type of mortgage: In 2022, fixed rates 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 over 96 billion euros in gross residential mortgage lending as of the third quarter of 2022. When comparing the total outstanding residential mortgage lending, the UK also ranks first with over 1.83 trillion euros.