UK Finance’s November mortgage update showed the average balance on a fixed rate mortgage was £175,655, compared with £147,468 for tracker borrowers and £68,550 for those on SVRs.
Fixed rate borrowers paid an average interest rate of 3.98%, against 4.84% for tracker customers and 6.52% for those on SVRs. Average monthly repayments were £1,013 for repayment borrowers on fixed rates, £966 for tracker borrowers and £662 for SVR customers.
UK Finance said a change in the Bank of England’s base rate would have no immediate effect on monthly payments for borrowers on fixed rate deals. However, tracker and SVR customers would be affected.
UK Finance calculated that a rise of 0.25 percentage points to the bank base rate (BBR) would add £30.72 to the average monthly tracker payment and £14.28 to the average SVR payment. A rise of 0.5 percentage points would increase those payments by £61.44 and £28.56 respectively.
However, a cut of 0.25 percentage points would save the average tracker borrower around £31 per month, while a cut of 0.5 percentage points would reduce payments by about £61 per month.
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Current market outlook
UK Finance said there are 8.47 million residential mortgages outstanding in the UK.
Fixed rate deals accounted for 87% of outstanding residential mortgages, equivalent to 7.37 million loans.
Tracker mortgages accounted for 6% of outstanding residential mortgages, equivalent to 510,000 loans.
A further 6% of outstanding residential mortgages, equivalent to 470,000 loans, were on SVRs.
Around 2.3 million fixed rate deals were due to expire by the end of 2027.
