UK households spent record £226bn on mortgage and rent in 2025, Savills finds

According to analysis of private and social rents and owner-occupier mortgages by Savills, the 3.6% jump in housing costs was lower than the £22bn increase seen in 2023 and the £19bn rise in 2024. 

In the last five years, housing costs have risen by 41% or £66bn. 

	2025 total UK housing bill (£m)	One-year change (£m)	Five-year change (£m) Sponsored Aldermore Insights with Jon Cooper: Edition 9 – Why lending strategy is becoming more central in buy to let Sponsored by Aldermore
Mortgage interest	53,694	+4,475	+26,717
Regular mortgage repayments	60,660	+369	+14,465
Total owner-occupier costs	114,354	+4,844	+41,182
Private rent	81,106	+1,937	+17,276
Social rent	30,872	+1,113	+7,583
Total renters	111,978	+3,050	+24,859
All households	226,332	+7,894	+66,041

Lucian Cook, head of residential research Savills, said: “The pace of growth in the nation’s housing costs has slowed substantially compared with 2023 and 2024. 

“In 2025, the burden of higher mortgage costs has been felt mainly by households coming off longer‑term fixed rate deals. At the same time, we’ve seen a return to much more normal levels of rental growth.” 

“In a market where homeowners are fixing their mortgages for longer, the impact of higher interest rates on housing costs – and on households’ ability to spend elsewhere in the economy – tends to have a much longer tail. 

“Until recently, 2026 looked set to offer some respite, but that is now less certain given the prospect of another wave of inflation, which mortgage markets are typically quick to price in.” 

Rising mortgage interest adds to expenses 

Savills said the increase had been driven by rising mortgage interest payments, which had gone up by 9% to £54bn in the last year and nearly doubled over five years, as mortgagors come off legacy, lower-rate five-year fixed rates. 

Some 8.8 billion mortgaged households in the UK paid £114bn in housing costs in 2025, suggesting an average expense of £13,000 per year. 

Although mortgage interest had risen sharply in five years, capital repayments have increased more moderately. Savills said this meant that overall housing costs for mortgaged owner-occupiers had risen by a lower 56%. 

Meanwhile, renters paid £112bn in housing costs, with £81bn going to private rental landlords. 

On average, the cost of renting came to £15,000 per year, a 27% rise in private rental costs in five years. 

A quarter of all housing costs paid by Londoners 

Savills research found that London recorded the smallest percentage increase in housing costs, rising 36% over five years, while Northern Ireland rose by the fastest, at 55%. 

Despite this lower growth, housing costs in London are equal to the collective expenses in Scotland, North East England, North West England, and Yorkshire and the Humber. 

The analysis showed that Londoners paid for just under a third of the entire private rental bill.