Homeowners face fresh blow as average fixed mortgage tops six per cent

‘If people lose homes, Tories could be wiped out’

- Jonathan Prynn and Nicholas Cecil 

HOMEOWNERS faced more misery today as the average five-year fixed mortgage rate rose above six per cent for the first time in a decade.

The grim news came as Kwasi Kwarteng was holding crunch talks with high street mortgage lenders after his mini-budget sparked economic mayhem, forcing the Bank of England to intervene and sending mortgage rates rising sharply.

Before the meeting, the Chancellor was warned by a senior MP that the Tories could face a “wipe-out” at the next general election if his plans lead to people losing their homes and small firms going bust.

Data from analysts Moneyfacts showed the average rate on a five-year fix, one of the most popular mortgage products, rose from 5.97 per cent yesterday to 6.02 per cent today, the highest in 12 years.

On the day of the Chancellor’s speech less than two weeks ago it was 4.75 per cent and a year ago they were at 2.55 per cent.

Average two-year fixes broke through six per cent yesterday and today stood at 6.11 per cent, the highest since November 2008.

The increases mean millions of homeowners face huge mortgage bill increases when their current deals come to an end.