What is the average monthly mortgage payment in the UK?

What is the average mortgage payment in the UK?

The average mortgage repayment in the UK now stands at £1,253 a month, according to recent analysis from Finder.

This is based on average house prices in April 2025, using the average two-year fix at the time, and it assumes a 15% deposit with repayments to be made over a 25-year term.

Despite some occasional dips (most notably during the financial crisis between 2007 and 2009 and after the pandemic), house prices have risen steadily over the last 25 years. 

According to the latest government data, the average price of a house in the UK is now  £269,000 - an increase of 3.7% on the previous year.

However, the average London house price is far higher than this, at around £561,309.

At the opposite end of the scale is the North East, with the UK’s lowest average house price at £163,679.

What is the average mortgage payment, including interest rates, in the UK?

As we mentioned, the current average UK monthly mortgage repayment on a typical house is £1,253.

However, this doesn’t provide a terribly helpful indication of what your costs are likely to be. Your monthly mortgage repayments will depend on the price of the property you are buying, the size of your deposit and the best mortgage rate you’re able to get.

The bigger your deposit and the better your credit score, the lower the rate you’ll likely pay.

Here is an overview of the current average UK mortgage payments on a home valued at £265,000, based on a 25-year term, but with various interest rates (based on deals in July 2025) and deposits. 

Two-year fixed-rate mortgage:

• Deposit: 10%

• Mortgage size: £238,500

• Mortgage rate: 4.58%

• Monthly repayment: £1,336.51

Two-year fixed-rate mortgage:

• Deposit: 40%

• Mortgage size: £159,000

• Mortgage rate: 4.16%

• Monthly repayment: £853.37

Five-year fixed-rate remortgage:

• Deposit: 25%

• Mortgage size: £198,750

• Mortgage rate: 4.08%

• Monthly repayment: £1,057.87

Standard variable rate mortgage:

• Deposit: N/A

• Mortgage size: £198,750

• Average mortgage interest rate: 7.6%

• Monthly repayment: £1,481.70

What factors affect mortgage rates?

In the UK, a variety of factors affect mortgage rates in general:

• The Bank of England (BoE) base rate: When the BoE base rate increases, variable mortgage rates also increase - but they can fall with any base rate cuts. This is closely linked with inflation. The base rate can impact mortgage rates offered by lenders.

• Inflation: When inflation increases or is too high, the BoE tends to push up the base rate to subdue it. By the same token, as inflation decreases, the BoE tends to lower the base rate.

• The type of mortgage

• Property market conditions

• Swap rates: Any rises and falls in interest rates on fixed-rate mortgages correspond directly to increases and decreases in swap rates. This is because swap rates impact the price at which lenders can borrow funds with which to purchase your house on your behalf.

In addition to this, lenders vary the mortgage rates they offer based on an extensive mortgage checklist:

• Your credit score and history.

• The size of your deposit.

• Your debt-to-income ratio and existing financial commitments.

• Your income and employment status.

• Property value and type.

• Your age.

• The number of applicants: You may find that applying for a mortgage with a spouse, for example, can decrease your risk level as a borrower in the eyes of lenders.

• The length of the mortgage term.

How is a mortgage calculated?

Here is the basic formula for how a mortgage is calculated (monthly):

P (r (1+r)^n) / ( (1+r)^n -1 )

r = Monthly interest rate (annual interest rate/12)

P = Principal amount (starting balance of the loan)

n = Total number of payments (12 times the number of years of your mortgage term)

Of course, this does not account for all factors, so Unbiased’s mortgage calculator will give you a more accurate indication of your mortgage payments. 

Here’s a table showing how different factors affect your mortgage:

* + = As the mortgage element’s value increases, the interest rises, and vice versa.

   –  = As the element’s value increases, the interest rate decreases, and vice versa.

How long is the average mortgage?

Mortgage term options range from as little as six months to as long as 40 years. 

Currently, the typical mortgage term in the UK is 25 years. 

However, due to the rising cost of housing, people are increasingly opting for longer terms in the UK to reduce their monthly payments.

The unfortunate flipside of this is that homeowners will ultimately end up paying more for their properties due to compound interest.

Can I lower my monthly mortgage payments?

Roughly a third of UK tenants and owners find it hard to make their monthly rent or mortgage payments.

The good news is that you can lower your monthly mortgage payments by various means:

• If you’re on a standard variable-rate mortgage, consider switching to an interest-only arrangement. This will protect you against increased inflation.

• Consider extending the mortgage term. Bear in mind that this will ultimately increase the total amount you pay due to increased compound interest.

• Remortgage onto a new deal with a lower interest rate.

• Try to overpay on your mortgage if you can to reduce your principal loan amount and corresponding interest. Remember that you may incur charges if you exceed your lender’s overpayment allowance.

• Pay fees upfront to help reduce your principal loan amount.

Seek expert mortgage advice

You should now have a much better understanding of how mortgage payments are calculated and data regarding the average UK mortgage payment.

This means you are in a much better position to make informed choices regarding your mortgage.

To learn more about mortgages and to find the most competitive deals, let Unbiased match you with a qualified mortgage broker.