Mortgage rates soared across the country last year, with particularly sharp increases after the disastrous mini-budget that led to the end of Liz Truss’s short term as prime minister.
Annual payment costs have risen to £13,980 in the most expensive areas, although households across the country are feeling the pinch.
The Bank of England warned in December that around half of the households with mortgages, a total of 4 million, will be exposed to rate hikes this year when their fixed terms expire.
According to the financial news site, about 800,000 of those households will see their payment rates double. Bloomberg.
Labor Party analysis has mapped the rise in reimbursement costs in parliamentary constituencies of England and Wales from last August, the month before the mini-budget, to last December.
In August, Moneyfacts said a typical two-year fixed mortgage rate was 3.95 percent, but by January it had risen to 5.75 percent.
Annual increases range from £950 in the County Durham area of Easington to £13,980 in Kensington in London.
Sheffield Hallam saw a rise of £3080, North East Derbyshire saw £2070, Plymouth, Sutton and Devonport saw £1850, Erewash in Derbyshire saw £1830.
House prices have been falling since late summer. January saw a 0.6 percent drop from December, according to figures from building society Nationwide.
Further declines are likely as the Bank of England is expected to raise interest rates on Thursday for the 10th time in a row, further boosting mortgage rates.
Higher mortgage rates tend to drive home prices down as people are less willing to borrow money.
Some experts believe the Bank is heading toward the end of its rate-hike cycle, offering some potential relief to hard-pressed borrowers.
The decision comes after Bank Governor Andrew Bailey expressed some optimism about the future of the UK economy by insisting the country has turned around rising inflation.
He said earlier this month that while Britain is still facing a recession, it could be “shallower” than previously expected, signaling a less severe recession.
On Tuesday, the International Monetary Fund (IMF) forecast that the UK will be the only major economy to fall into recession this year, with a contraction of 0.3 percent.
Chancellor Jeremy Hunt acknowledged the gloomy forecast but insisted that the UK’s long-term growth prospects are brighter.
Responding to Labor’s mortgage price analysis, Shadow Chancellor Rachel Reeves said: “The Conservative mortgage penalty is devastating to household finances and is holding back our economy.
“The country is sinking under 13 years of conservative mismanagement, and families are being asked to pay more on their mortgages once again.
“People wonder if they or their families are better off with the Tories. The answer is no.
“By stabilizing the economy, strengthening it and making it grow, Labor will prevent us from going from one crisis to another and make Britain prosperous again.”