Mortgage borrowers warned ‘take action now after rate rise

But, it might not be all bad news for tenants who would like to get on the property ladder.

Ms Flynn said: “With landlords turning their backs on rising mortgage interest rates, there could be an increasing number of properties on the market, potentially providing more options for first-time buyers.

“The housing market momentum may also be showing signs of slowing, with Halifax reporting a 0.1 per cent month-on-month fall in house prices across the UK in July.”

Commenting on the news, Adrian Anderson, director of property finance specialists, Anderson Harris said the increased interest rate: “Is a 50 basis points hike and takes borrowing costs to their highest levels since November 2008.

“The Bank’s monetary policy committee were split five-four on the rate hike. Experts are anticipating more large rate hikes later in the year and into 2023, which is going to heap misery on mortgage payers and have a severe impact on households’ disposable income.

“The message to mortgage borrowers is very simple – don’t wait, take action now, as it’s likely the situation will get worse in the short term. Borrowers are actively shopping around and seeking to fix their mortgage payments now before the monthly mortgage pain gets even worse.

“This is a huge reality check. The landscape has changed quickly, we are no longer living in a period of ultra-low interest rates with plenty of disposable income; our outgoings are increasing faster than our income and we are going to have to adjust quickly and get used to the new norm.”

How to keep mortgage repayments down

Those whose fixed-rate mortgage is coming to an end soon may want to consider changing their deal early to take advantage of interest rates before they increase again, according to Ms Flynn.