Homeowners are being hit with a “Tory mortgage penalty” of £7,000, Labour has claimed, following a surge in interest rates.
Pat McFadden, shadow chief secretary to the Treasury, said the “reckless economic gamble” taken by Liz Truss and Kwasi Kwarteng last year had contributed significantly to the surge in mortgage borrowing costs.
Labour’s analysis found that the average homeowner is spending an extra £150 every week since their infamous mini-budget last September.
Mortgage interest payments now typically stand at £223 a week – an increase of £7,000 a year, the Labour claims.
Labour said those with a 75% loan-to-value mortgage faced average rates of up to 4.63% in April.
The same mortgage deal had an interest rate of 1.49% in April 2021, two-thirds less.
McFadden commented: “Britain’s homeowners continue to suffer thanks to the Tories’ reckless economic gamble.
“This Tory mortgage penalty has increased the cost of home ownership by thousands of pounds a year, causing huge worry for families, while putting the prospect of owning a home further out of reach for many others.
“Rishi Sunak might want to forget the economic misery the Conservatives have inflicted, but the public can’t forget about it as their outgoings soar.”
In response, the Conservative Party did not reference Labour’s mortgage rate criticisms.
A Tory spokesperson said: “Labour proved once again this week why they can never be trusted with our economy.
“Their economic credibility is in tatters after Rachel Reeves finally admitted Labour’s borrowing spree would fuel inflation and send interest rates spiralling.
“The truth is Labour would have to resort to unlimited borrowing and hiking up taxes to fund their plans, hitting hardworking British people’s wallets.
“The Conservatives are getting on with the job of halving inflation, growing the economy, and reducing debt.”
