A million more homeowners face higher mortgage bills than the Bank of England had previously expected due to the impact of the Iran war.
Just over five million homeowners should expect their monthly mortgage repayments to increase by the end of 2028, according to Bank forecasts.
That is up from 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, external. That compares to a typical rise of £120 for those getting a new deal between the end of 2022 and end of 2024.
However, 750,000 homeowners who are paying less than 3% interest on their current deal would be rolling off these products this year and would see an average increase of £170 per month in repayments, the Bank said.
It is even more for Saima Siddiqui, who will soon refinance her one-bedroom flat in Surrey for the first time.
“It means I’m going to have to be more careful with other things,” the 33-year-old said.
“It was alright as it was, but the extra £200 means I’m going to have to budget a lot more carefully.”
