Many years have passed since the UK’s mortgage rate peaked at 15.4 per cent, it has been noted.
HSBC observed it was 22 years ago when the levels last hit those heights, while tomorrow (March 3rd) will see the third anniversary of the base rate reduction to 0.5 per cent – an all-time low.
According to the bank the last two decades have seen a number of changes that have significantly altered the home loan market.
It was found that the average UK house price in March 1990 stood at £69,240, while the typical cost of a dwelling in the same month in 2012 now comes to £160,907.
In addition, the findings revealed the standard variable rate on borrowing has jumped from 15.4 per cent to six per cent during this time, while the average mortgage size has swelled from £35,000 to £120,400.
Peter Dockar, head of mortgages at HSBC, said the statistics suggest the market is now in a better state of affairs than it was during the last downturn of the 1990s.
The industry figure added: “It is unlikely we will ever see rates peak as high as they did in 1990 in our lifetimes, however, there is no doubt that rates can only go one way.”
