BOE Money and Credit data – comment

“The ‘effective’ interest rate, which is the actual interest rate paid, has risen every month in 2022. For newly drawn mortgages the effective interest rate has almost doubled since January 2022 from 1.58% to 3.09% in October, a rise of 25 basis points from September.

“These increases are to be expected as Bank base rate and swap rates have also risen throughout the year, but almost doubling in ten months for new mortgages goes to show how swift the rate rises are.

“As interest rates rise there has been a slowdown in new borrowing while house purchase approvals are down again and lower than the six-month average. With buyer demand now waning, house price growth slowing and the high cost of living impacting on people’s pockets, the housing market is starting to take a hit.”

Simon Webb, managing director of capital markets and finance at LiveMore

Link to BOE stats