Tony Lloyd: Working people paying the price for Tory mortgage hike

7,490 households in Rochdale will face an eyewatering jump in mortgage repayments next year as a result of the Conservatives crashing the economy.

Tony said, “People in Rochdale who have scrimped and saved for a deposit have been thrown under the bus by the Tories.

“This isn’t some kind of ‘unfortunate mistake’, it’s an unforgivable act of national self-harm that has crashed the economy. A Tory crisis, created in Downing Street, paid for by working people.

“It doesn’t have to be this way. A Labour government will target 70% homeownership, including giving first-time buyers first chance on new developments and a state-backed mortgage insurance scheme.”

Analysis by the Labour Party using Bank of England data showed that homeowners coming off two-year fixed term mortgages in October 2022 are set to pay £500 a month more on average after the government’s disastrous mini-Budget handed unfunded tax cuts to the wealthiest.

Further investigation has found that the number of people refinancing on the terms above is forecast to be 1.8 million people out of a total 6.8 million mortgage holders – or one in four of all mortgage holders in the UK.

That means an estimated 7,490 households in Rochdale will be paying hundreds of pounds a month more from next year as rates top 6%.


Notes to editors:-

The ONS Estimates 6.8 million properties in the UK were owned with a mortgage or loan. Source

UK Finance expects around 1.8 million people to re-mortgage in 2023, which is 26% of all mortgages. Source

ONS estimates the numbers of households by tenure in 2020 Source

RegionLocal authority name2020 Owned with Mortgage or LoanEstimated number refinancing in 2023*
North WestRochdale28,8067,490

*Assuming a national average 26% of mortgagers refinancing after a two-year tracker in 2023

Previous Labour analysis found the average mortgage owner coming off a 2-year fixed rate mortgage will be paying £500 a month more on their mortgage following interest rate increases.

Figures assumed a 20 year mortgage term. Interest rates in Q3 2020 for a two-year fix were 1.6 per cent according to Bank of England figures. Average mortgage advance in 2020 Q3 taken from ONS. Analysis assumes borrower now pays a 5% interest rate once their two year fix ends in Q3 2022.. Full breakdown by region below:

 RegionMortgage advance (average Q3 2020)Monthly repayments (1.6%)Monthly repayments (5%)Monthly repayments (6%)Monthly increase at 5%Monthly increase at 6%
UK217000£1,057 £1,432 £1,555 £375 £498 
NE143000£697 £944 £1,024 £247 £327 
NW163000£794 £1,076 £1,168 £282 £374 
Y&H157000£765 £1,036 £1,125 £271 £360 
EM172000£838 £1,135 £1,232 £297 £394 
WM180000£877 £1,188 £1,290 £311 £413 
EE250000£1,218 £1,650 £1,791 £432 £573 
L399000£1,944 £2,633 £2,859 £689 £915 
SE279000£1,359 £1,841 £1,999 £482 £640 
SW208000£1,013 £1,373 £1,490 £360 £477