Families are almost £1,400better off when taking out a typical mortgage since Labour came to office, new analysis has found.
The average cost for a new two-year fixed mortgage across England and Wales was £1,185 per month in June 2024.
However, following the Labour Government’s action to restore stability to the economy – with six interest rate cuts since the General Election, the fastest pace of cuts in 17 years – the cost of a typical new mortgage has fallen to £1,071 per month.
This means that families taking out a new mortgage are saving around £114 each month, or £1,368 a year – putting money back in people’s pockets.
These savings have been felt by households in every corner of the country, including here in the East Midlands, where the vast majority of constituencies saw annual savings above the average.
For example, a typical mortgage of an average house in Rushcliffe, Nottinghamshire, cost £2,240 a year less in December 2025 compared with an identical mortgage in June 2024, with the saving rising to £2,250 in South Northamptonshire.
The equivalent annual saving in Derby North was £1,410, in Gainsborough it was £1,440, and in Loughborough it was £1,600.
Following the disastrous Liz Truss mini-budget, two-year fixed mortgage rates shot up to over six per cent in October 2022. That piled misery onto families, adding hundreds of pounds onto their monthly bills when buying a home or remortgaging in the period that followed.
Chancellor Rachel Reeves’ management of the economy since the General Election has meant that interest rates on typical mortgages fell from 5.16% in June 2024 to 3.97% in December 2025.
That stands in stark contrast to the Tories’ catastrophic record which saw the economy crashed and family finances fleeced.
Nigel Farage’s Reform have promised to go further than the Tories’ disastrous policies, splurging billions on unfunded pledges, which risks interest rates rising again, and putting up every mortgage in the country.
The news on mortgages comes alongside a wider package of measures introduced by the Labour government that will give security to and protect the pockets of working people in their living arrangements.
As mortgage holders benefit from reduced costs, the Renters’ Rights Act – coming into force on 1 May 2026 – will see ‘no fault’ evictions banned, and it will become illegal for landlords and letting agents to:
- Increase rent prices more than once a year
- Ask for more than one month’s rent payment in advance
- Pit prospective tenants against one another through rental bidding wars
- Discriminate against potential tenants, because they receive benefits or have children.
James Murray MP, Labour’s Chief Secretary to the Treasury, said:
“The Tories dealt a hammer blow to family finances when they crashed the economy and sent mortgages, rents and bills soaring.
“Labour is bringing the cost of living down. We’ve stabilised the economy, leading to six interest rate cuts and lower mortgage costs.
“We’re also cutting £150 off average energy bills, freezing rail fares, freezing prescription fees, raising the minimum wage and lifting over half a million children out of poverty. This is the year when working people across Britain will start to feel the benefit of the change Labour is delivering.”
