More people are feeling a financial strain than at any other time in the last two years, polling has shown, with a rise in mortgage bills set to put household budgets under greater pressure. 

New /Freshwater Strategy polling has suggested that half of mortgage holders will come off fixed-rate deals by the end of 2028, leaving them exposed to a huge jump in their mortgage repayments. 

Figures showed that nearly three in ten (29 per cent) people believed they were not confident they would be able to afford the rise in bills while more than half (53 per cent) expected a large increase in mortgages. 

The fresh set of data precedes an expected interest rate hike by the Bank of England to four per cent this Thursday, its first hike since August 2023. 

The Bank’s Monetary Policy Committee had gradually brought interest rates down from a peak of 5.25 per cent in a rate-cutting cycle beginning in 2024, although it could once again tighten monetary policy in response to a spike in energy prices due to the Iran war.

According to the industry body UK Finance, an interest rate hike will impact 2.3m households reaching the end of their fixed-rate deals in 2027, many of which were agreed when interest rates were as low as one per cent. 

Most banking groups expect interest rates to rise on Thursday. 

Mortgages set to put families in ‘troubled’ situation

While some lenders are competing to offer better deals as interest rates rise, economists at a government watchdog believe the effective interest rate on the outstanding stock of mortgages will rise from around four per cent this year to five per cent by 2031. This will come as people “roll off mortgages that were fixed when rates were lower”. 

In July, the Bank of England said it expected around 5m households to see their repayments increase by the end of 2028, a higher projection than it had previously made before the Iran war. 

For the typical owner-occupier who is coming off a fixed rate in the next two years, mortgage repayments are set to be £45 higher than previously anticipated. The Bank could upgrade this difference if it opts to raise interest rates and take a more cautious approach on the path of monetary policy in the future.

A rise in mortgages for millions of families could add to a heap of costs facing families over the next year as inflation continues to edge higher and fuel prices remain elevated. 

/Freshwater Strategy polling showed that financial strain was at the “highest level” since tracking began in early 2025 as two in five voters were either cutting discretionary spending or struggling with paying essential bills. 

About one in 10 respondents said they were “troubled” and were incurring debt in order to pay bills. 

Method note: Freshwater Strategy interviewed n=1,219 eligible voters in the UK, aged 18+ online, between 30 October – 1 November 2026. Margin of Error +/- 2.8%. Data are weighted to be representative of UK voters. Freshwater Strategy are members of the British Polling Council and abide by their rules.