According to the Resolution Foundation, mortgage payments will rise by £26 billion per year over the next two years. Households in London will face the greatest increase, with average payments expected to rise by £8,000 during this time period, more than double the £3,400 increase experienced by households in Wales. However, the impact will be concentrated in London, where less than a fifth (19%) of households have a mortgage. “Households throughout the United Kingdom are currently experiencing an inflation-driven cost-of-living crisis as pay packets shrink and energy bills rise,” said Lindsay Judge, research director at the Resolution Foundation. With nearly half of all mortgagor households on track to see their family budgets fall by at least 5% due to higher payments, the impact of rising interest rates on living standards will be widespread.” While some homeowners with variable rate mortgages will see their costs rise immediately, the majority of mortgaged homeowners with fixed-rate mortgages will see their costs rise over time as they transition from lower rates to new deals, according to the think tank. After former chancellor Kwasi Kwarteng announced his fiscal policy in the House of Commons, the number of deals on the market plummeted. Lenders have gradually resumed new deals, but have raised their rates in the process, with average two- and five-year fixed mortgage rates now at their highest levels since 2008, at 6.47% and 6.29%, respectively. According to Moneyfacts.co.uk, there were 3,112 mortgage products on the market on Friday, compared to 3,961 on the day of the mini-budget. According to the Resolution Foundation’s current projections, by early 2025, half of all mortgaged households will have seen higher mortgage costs absorb at least 5% of their net income.