Elsie Blundell, MP for Heywood and Middleton North, has welcomed the news that Interest Rates have dropped below 4% on typical mortgages.
“The previous Government mismanaged the economy with the disastrous Liz Truss Budget, which blew up everyone’s mortgage. Since the election, the Labour Government have been focussed on bringing interest rates back down, because it means real money in the pockets of families.
“Repairing the damage of the Conservative management of the economy will take time. News like this is proof that Labour is making a difference where it matters most. At home.”
New analysis shows that a household taking out a new, representative, mortgage on a £215,000 house in December 2025 – the median price in Heywood and Middleton North – will pay £1,380 a year less than they if they took out an identical mortgage in June 2024, at the time of the election.
This means that families taking out a new mortgage are saving around £115 each month – putting money back in people’s pockets.
If quoted mortgage rates fall by a further 0.5ppts over the coming year, that saving will rise to £1,720.
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.
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.”
For the purposes of this calculation, a representative mortgage is assumed to be a new, two year fixed mortgage with a 75% loan to value ratio and a 29 year term. Average mortgage rate data comes from the Bank of England. Median house prices are based on properties sold in the 12 months to March 2025.