1.4m UK mortgage holders face 20% hit to disposable income from rate hikes

The IFS said half of the affected 1.4 million mortgage holders were under 40, and that those in London would face the biggest hit. Photograph: Neil Hall/EPA

More than 1 million households across Britain are expected to lose at least 20% of their disposable incomes thanks to the surge in mortgage costs expected before the next election, the UK’s leading economics thinktank has warned.

Sounding the alarm as mortgage costs reach the highest levels since the 2008 financial crisis, the Institute for Fiscal Studies (IFS) said that almost 1.4m mortgage holders would see at least a fifth of their disposable income erased.