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Mortgage calculations
Sources and notes
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See sources and notes for details
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<= 2 year fixed rate5 year fixed rate
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Average mortgage rate for new mortgages:
Mortgage rates
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July 20244.984.44
Mortgage rates are effective interest rates for individuals and individual trusts, on new mortgages
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June 20254.334.25
They are monthly averages of UK resident banks' sterling weighted average interest rate for new advances on loans secured on dwellings
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% point reduction-0.65-0.19
Series codes are CFMZ6JX and CFMZ6K3
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reduction as a percentage-13%-4%
https://www.bankofengland.co.uk/statistics/visual-summaries/effective-interest-rates
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Estimated monthly mortgage payment on new mortgage at mean amount and duration:
Mortgage amount and length
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based on July 2024 average rate£1,279£1,204
Mortage amount (advance) and lengths are based on figures for 2024 from UK Finance Table RL3A UK
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based on June 2025 average rate£1,189£1,178
They are based on all loans for house purchase for new mortgages, both for first time buyers and others
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£ reduction over period-£90-£26
Averages are mean figures. Mean advances are likely to be above the typical (median) amounts, as they will be distorted by a relatively small number of high values.
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reduction as a percentage-7%-2%
This will also increase monthly mortgage payment values beyond what might be typical.
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Average mortgage rate for new mortgages (alternative scenario):
Alternative scenario
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July 20244.984.44
The alternative scenario see rates fall by 19%, in line with the change in the Bank of England base rate between July 2024 and June 2025
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If rate fell by 19%4.033.59
In reality mortgage rates are influenced by factors beynd the base rate, in particular changes in expectations of where rates are heading
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Estimated monthly mortgage payment on new mortgage at mean amount and duration (alternative scenario):
Calculation of mortgage payments
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July 2024£1,279£1,204
Mortgage payments are monthly figures
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If rate fell by 19%£1,149£1,091
Calculation of average monthly mortgage is approximate, based on a repayment mortgage at the rate, term and length specified with no associated fees
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£ reduction over period-£131-£113
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reduction as a percentage-10%-9%
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