Commons Sense

House of Commons · Ministers' Questions

Mortgage Rates

Tuesday 21 March 2023 · 8 questions

Summarised by AI from the official record, so it can contain mistakes.

Read the full transcript on Parliament.uk

At a glance

Answered 0 Partly answered 7 Not answered 0

Key points

  • Ministers are working with Cabinet colleagues to support homeowners facing higher mortgage rates.
  • The Government have provided a 94 billion package of support for households.
  • Interest rates in the UK are now lower than in the US and below the levels seen last autumn.

Topics (select to filter)

Questions & Answers

Q1 Andrew Western Lab Stretford and Urmston
Economy Housing
Context

The MP is concerned about the impact of rising mortgage rates on homeowners in his constituency.

Question

Whether he is taking steps with Cabinet colleagues to support homeowners with increases in mortgage rates.

Answer from Andrew Griffith

Mortgage lenders are required to offer a range of tailored support to borrowers in financial difficulty. The Chancellor and I have made clear our expectation that they live up to those responsibilities.

Partly answered

Not addressed: Specific steps or actions taken by the government were not detailed

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Q2 Mike Amesbury Lab
Economy Housing
Context

The MP inquires about the impact of increased mortgage rates on his constituents and seeks an apology from the Chancellor.

Question

A typical family are now paying up to £2,000 more for their mortgage, partially as a result of the former Prime Minister. First, will the Chancellor apologise to those people, who number about 20,000 in my constituency? Secondly, will he seriously do something about it?

Answer from Andrew Griffith

The Government are supporting households with a £94 billion package of support. We have kept the energy price guarantee for an additional three months and we are bearing down—I hope the hon. Gentleman joins us in doing this—on the biggest cost of living challenge faced by families, which is inflation.

Partly answered

Not addressed: Specific apology or concrete action regarding mortgage rates was not provided

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Q3 Andrew Western Lab Stretford and Urmston
Economy
Context

The MP criticizes the impact of Conservative economic policies on mortgage rates and inflation, asking for an apology.

Question

Thirteen years of failed Tory economic policies, alongside last year's disastrous mini-Budget, have, as my hon. Friend the Member for Weaver Vale (Mike Amesbury) says, left thousands and thousands of mortgage holders subject to high interest rates and sky-high inflation. So I repeat his call: will any member of the Treasury team have the decency to apologise to the very many hard-pressed families who are currently subject to the Tory mortgage penalty?

Answer from Andrew Griffith

Interest rates are not only falling but are still below the level at which they peaked under the last Labour Government, despite the fact that we have had a covid pandemic and war in Ukraine. I welcome the news last week from the Office for Budget Responsibility that the country is on track to avoid a recession, and we must never forget the words of the right hon. Member for Birmingham, Hodge Hill (Liam Byrne): there is no money left.

Not addressed: The question about an apology was not addressed

How: Redirecting To Previous Labour Government'S Performance, Mentioning Obr Forecasts

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Q4 Alun Cairns Con
Economy
Context

The MP is concerned about the impact of the Credit Suisse takeover on the value of additional tier 1 bonds and the stability of the UK banking sector.

Question

A competitive and viable banking sector is essential to offer competitive mortgages to constituents right across the country. What assessment has my hon. Friend made of the treatment of additional tier 1 bonds in relation to the Credit Suisse takeover, which could well undermine the sector elsewhere, and what assessment has he made of the value of those bonds here in the UK?

Answer from Andrew Griffith

I thank my right hon. Friend for his comments. The Government join the Bank of England in welcoming the comprehensive set of actions taken yesterday by the Swiss authorities to ensure financial stability. It would not be for me to talk from the Dispatch Box about the treatment of creditors, but the UK's bank resolution framework has a clear statutory order in which shareholders and creditors would bear losses in a resolution or insolvency scenario.

Partly answered

Not addressed: Specific assessment on bond values and sector impact was not provided

How: Referring To Swiss Authorities' Actions, Mentioning Statutory Order For Loss Bearing

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Q5 Pat McFadden Lab Wolverhampton South East
Economy
Context

4 million households face increased mortgage costs due to September's mini-Budget, with average two-year fixed rate deals now around £2,000 more expensive than in August 2022.

Question

The Conservative party wants to pretend that last September's mini-Budget and its impact on mortgages was all a bad dream. The average two-year fixed rate deal is now around £2,000 a year more than it cost in August last year. What is the Government's estimate of the total cost of September's mini-Budget to UK homeowners?

Answer from Andrew Griffith

Interest rates in the UK are now lower than the equivalent in the US and are lower than they were last autumn. The Government have a range of measures to help hard-pressed mortgage payers, but above all else, our strong stewardship of the economy is bringing down interest rates and means that we are on track to halve inflation this year.

Partly answered

Not addressed: The total cost estimate was not provided.

How: Blaming Global Factors, Focusing On Future Improvements

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Q6 Pat McFadden Lab Wolverhampton South East
Economy Housing
Context

The Prime Minister reduced the house building target shortly after taking office, leading to a Home Builders Federation prediction that new housing supply will fall below half the Government's original target.

Question

One of the first things that the Prime Minister did when he took office was to give in to his Back Benchers on house building targets. The Home Builders Federation says that the supply of new housing is likely to fall to its lowest level since the second world war—less than half the Government's target. How will fewer homes help young people who dream of owning their own home and getting on the property ladder?

Answer from Andrew Griffith

The best way to help young people own their own home is to have a vibrant, growing economy. We are on track to restore economic growth and take actions that will do so.

Partly answered

Not addressed: Specifics about fewer homes helping young people were not provided.

How: Focusing On The Broader Economy, Criticizing Labour

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Q7 Stewart Hosie SNP
Economy Housing
Context

Last August, there were 75,000 mortgage approvals. By December, this number halved, with reports of mortgage product removals and offer withdrawals.

Question

Before we even get to the issue of support for mortgage holders, what is the Treasury doing to ensure the availability of mortgages, a good range of mortgage products and an end to offers being withdrawn unless there is a very, very good reason to do so?

Answer from Andrew Griffith

We have recently renewed the mortgage guarantee scheme which helps the availability of high loan to value ratio mortgages. We are looking very clearly at the mortgage market and at things that we can do to help first-time buyers.

Partly answered

Not addressed: Specific measures ensuring an end to offer withdrawals were not provided.

How: Focusing On Renewed Schemes

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Q8 Stewart Hosie SNP
Economy Housing
Context

Interest rates for two-year fixed-rate mortgages have significantly increased over the past year, impacting average-priced house purchases.

Question

A two-year fixed-interest mortgage with a 5% deposit was under 3% last August but is now north of 6%. A similar mortgage with a 25% deposit has also seen its interest rate increase from 1.25% to over 6%. How can it possibly be fair that somebody buying an average-priced house in Scotland worth around £190,000 could face such high interest rates?

Answer from Andrew Griffith

Interest rates are now falling, something the right hon. Gentleman declined to mention. The best thing we can do to help those interest rates is to deliver on the Prime Minister's objective of halving inflation.

Partly answered

Not addressed: Fairness in high mortgage interest rates was not addressed directly.

How: Focusing On Future Actions

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