According to figures from the Office for National Statistics (ONS), 57 per cent of fixed rate mortgages coming up for renewal in the UK were fixed at below two per cent.
Deals due to mature next year will be two-year fixed rate deals were made in 2022 and five-year fixed rate deals secured in 2019 when mortgage rates are higher than two per cent.
The report continued that 353,000 fixed rate mortgages are due to renewed in the first quarter of this year.
In the second quarter, the ONS estimated around 371,000 fixed rate deals could come to an end.
The report said interest rates had been rising since the end of 2022 but most fixed rate borrowers have been insulated from those rises as they fixed at below two per cent and were within their period.
ONS said borrowers remortgaging in the near future would likely do so at a higher rate of interest. It pointed to the Office for Budget Responsibility’s expectations of the bank rate, which it said was likely to peak at 4.8 per cent at the end of 2023.
The statistical body said according to the Bank of England, the effective interest rate on outstanding mortgages was 2.08 per cent in November last year. Meanwhile, the average interest rate on a variable mortgage at the time was 4.41 per cent and quoted household interest rate on new fixed mortgages were around six per cent.
If the interest rate for a £100,000 mortgage, assuming a 25-year capital and repayment mortgage term, rose from two per cent to six per cent mortgage repayments would increase by £220 to £644.
For £300,000 mortgage monthly mortgage repayments would increase by £661 to £1,933.
The research also found that around four in 10 of those with a mortgage are worried about changes in interest rates on their mortgage.
ONS said one per cent of mortgagors said they were behind on mortgage payments and seven per cent of renters said they were behind on rent payments.
Renters spending nearly quarter of weekly spending on rent
ONS said over a quarter of renters surveyed at the end of last year had reported their rent payments had gone up in the last six months.
The report said private rental prices paid by tenants rose by four per cent in the 12 months to November, which is up from 23.8 per cent in the 12 months to October.
ONS noted that in the 12 months to March 2021, renters spent £106.50 per week on rent, equivalent to 24 per cent of their monthly weekly expenditure.
Mortgage holders spent a total of £140.80 per week on mortgage repayments, or around 16 per cent of their median weekly expenditure.
