Business Intel

One million more UK homeowners set to face higher mortgages

July 7, 2026
Globalfinserve

One million more UK homeowners set to face higher mortgages

A couple in a kitchen looking at bills and a tablet computerGetty Images

Kevin Peachey

Cost of living correspondent
  • 3 minutes ago

The impact of the Iran war means a million more homeowners face higher mortgage bills than the Bank of England had previously expected.

Just over five million homeowners should expect their monthly mortgage repayments increase by the end of 2028, according to Bank forecasts.

That compared to four million projected by the Bank in December.

However, the Bank's Financial Stability Report said the hit would not be as hard as seen in recent years.

A typical owner-occupier rolling off a fixed rate in the next two years is likely to face an increase of £45 on their monthly mortgage bill, the Bank said. That compares to a typical rise of £120 for those getting a new deal between the end of 2022 and end of 2024.

More than eight in 10 mortgage customers have fixed-rate deals.

The interest rate on this kind of mortgage does not change until the deal expires, usually after two or five years, and a new one is chosen to replace it.

A modern browser with JavaScript and a stable internet connection is required to view this interactive.

How much could my mortgage payments change?


If you have an existing mortgage enter the outstanding balance left to pay. If not, enter the total you are looking to borrow.



If you have an existing mortgage enter the total number of years remaining. If not, enter the total number of years you are looking to borrow over.


What is your current…

For those with a mortgage enter the rate for your current fixed term. For those without a mortgage enter an interest rate from another source, such as a bank's mortgage rate calculator.



The information you provided on your monthly payments would not be sufficient to pay off your mortgage within the number of years given.

This calculator does not constitute financial advice. It is based on a standard mortgage repayment formula dependent on the mortgage size and length and a fixed interest rate. It should be used as a guide only and does not represent the suitability, eligibility or availability of mortgage offers for users. For exact figures, users will need to approach an official mortgage lender.

Interest rates fluctuate based on the Bank of England's base rate and market conditions

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The Bank's report also says that lower income households, including renters, are likely to be more exposed to higher energy prices.

"They spend a larger share of their income on essentials, limiting their ability to adjust spending in response to higher prices," it said.

However, overall, the report suggested that household finances remained resilient "even in a challenging external environment".

Household debt remained low relative to historical averages.

Although some vulnerable, low-income households remained more exposed, it said debt was unlikely to lead to sharp reductions in buying by consumers.

Elsewhere in the report, the Bank said rapid advances in AI had led to heightened risks over cyber attacks.

It also said valuations of AI stocks had become "more stretched" amid concerns of a bubble. The Bank sounded a similar warning in December.

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