More than 1.4 million households are facing the prospect of interest rate rises when they renew their fixed-rate mortgages this year, according to the Office for National Statistics (ONS). The majority of fixed-rate mortgages in the UK (57%) which are coming up for renewal in 2023 were fixed at interest rates below 2%, it said.
Deals that are due to mature in 2024 will include two-year fixed rate deals from 2022 and five-year fixes from 2019, when mortgage rates were generally higher than 2%, the report added. The ONS said that, based on Bank of England data, a peak in fixed deals ending is expected between April and June this year.
A string of Bank of England base rate hikes have taken place over the past year, but borrowers on fixed-rate mortgages have been cushioned from their immediate impact. Some may get a bill shock when they come to renew.
