I often get asked whether I think rates will go up or down. Although there is no right or wrong answer it’s true to say that rates have never been as low as they have in recent years.  Taking a look at the Bank of England historic interest rates makes for scary reading though.

Anyone under the age of 30 will probably not remember when interest rates were over 2%, much less when they were double digits.

Being born in the late 70s, I still remember coming home from school one day to find my mum in tears as the Bank of England base rate had gone up again.  It hit 14.88% in October 1989 and stayed at that rate for a year.

It must have been a scary time for mortgage borrowers.

1989 vs 2018

To give a quick comparison, if you borrowed £200,000 over 25 years at 14.88% you’d be paying back around £2,541 every month.

Borrowing the same against a rate of 0.75% which is the current Bank of England base rate as I write this, the repayments would be £731 per month.

That’s a staggering £1,810 difference in payments each and every month.

Bank of England historic interest rates

Yet that’s still only using the highest rate that I can remember in my lifetime.  Going back further when I was just a toddler the rate hit 17%.  That was November 1979.

Seeing figures like that probably goes some way to explaining why I’m an only child – I doubt my parents could have afforded any more kids with that kind of rate!

I’ve listed the Bank of England Base Rate History further down the page.

Will the Bank of England base rate go up?

The answer, in short, is yes.  Probably.

Mortgage illustrations these days have a section which shows the APRC (which stands for Average Percentage Rate of Charge). This is based on the highest rate in the past 20 years.

It provides a scary glimpse as to what a repayment on a mortgage would be if rates rose.

For those who have experienced higher rates, it’s a reminder of where we’ve been.  For first time buyers and those young enough to only know the lower rates, it’s often a shock.

Fixing your mortgage rate, whether it’s for 2 years, 10 years or somewhere in between can help.  It means that you know how much you are paying irrelevant of the Bank of England rate changes.

Having a variable rate leaves borrowers open to higher repayments though.

Would you be able to cope with big rate rises?

Historic interest rates

Year Rate at
year end
1979 17.00%
1980 14.00%
1981 14.38%
1982 10.00%
1983 9.06%
1984 9.50%
1985 11.38%
1986 10.88%
1987 8.38%
1988 12.88%
1989 14.88%
1990 13.88%
1991 10.38%
1992 6.88%
1993 5.38%
1994 6.13%
1995 6.38%
1996 5.94%
1997 7.25%
1998 6.25%
1999 5.50%
2000 6.00%
2001 4.00%
2002 4.00%
2003 3.75%
2004 4.75%
2005 4.50%
2006 5.00%
2007 5.50%
2008 2.00%
2009 0.50%
2010 0.50%
2011 0.50%
2012 0.50%
2013 0.50%
2014 0.50%
2015 0.50%
2016 0.25%
2017 0.50%

Information taken from Mortgage Strategy.

Bank of England Base Rate History

Date Changed Rate
20 Jan 75 11.25
27 Jan 75 11.00
10 Feb 75 10.75
17 Feb 75 10.50
10 Mar 75 10.25
24 Mar 75 10.00
21 Apr 75 9.75
05 May 75 10.00
28 Jul 75 11.00
06 Oct 75 12.00
17 Nov 75 11.75
01 Dec 75 11.50
29 Dec 75 11.25
05 Jan 76 11.00
19 Jan 76 10.75
26 Jan 76 10.50
02 Feb 76 10.00
09 Feb 76 9.50
01 Mar 76 9.25
08 Mar 76 9.00
26 Apr 76 10.50
24 May 76 11.50
13 Sep 76 13.00
07 Oct 76 15.00
22 Nov 76 14.75
20 Dec 76 14.50
29 Dec 76 14.25
10 Jan 77 14.00
24 Jan 77 13.25
31 Jan 77 12.25
03 Feb 77 12.00
10 Mar 77 11.00
21 Mar 77 10.50
31 Mar 77 9.50
12 Apr 77 9.25
18 Apr 77 9.00
25 Apr 77 8.75
02 May 77 8.25
16 May 77 8.00
08 Aug 77 7.50
15 Aug 77 7.00
12 Sep 77 6.50
19 Sep 77 6.00
10 Oct 77 5.50
17 Oct 77 5.00
28 Nov 77 7.00
09 Jan 78 6.50
12 Apr 78 7.50
08 May 78 8.75
15 May 78 9.00
08 Jun 78 10.00
09 Nov 78 12.50
08 Feb 79 14.00
01 Mar 79 13.00
05 Apr 79 12.00
13 Jun 79 14.00
15 Nov 79 17.00
03 Jul 80 16.00
25 Nov 80 14.00
11 Mar 81 12.00
25 Aug 81 12.69
15 Sep 81 14.00
12 Oct 81 15.00
28 Oct 81 15.13
06 Nov 81 15.06
09 Nov 81 14.63
25 Nov 81 14.56
04 Dec 81 14.38
18 Jan 82 14.31
19 Jan 82 14.25
20 Jan 82 14.13
21 Jan 82 14.00
22 Jan 82 13.88
22 Feb 82 13.81
25 Feb 82 13.63
10 Mar 82 13.25
16 Apr 82 13.13
19 Apr 82 13.00
20 Apr 82 13.13
08 Jun 82 12.63
09 Jul 82 12.50
12 Jul 82 12.25
13 Jul 82 12.13
21 Jul 82 12.06
26 Jul 82 11.94
28 Jul 82 11.81
29 Jul 82 11.75
30 Jul 82 11.63
02 Aug 82 11.56
04 Aug 82 11.50
16 Aug 82 11.38
17 Aug 82 11.25
24 Aug 82 11.13
25 Aug 82 11.00
26 Aug 82 10.88
27 Aug 82 10.63
27 Sep 82 10.50
28 Sep 82 10.38
29 Sep 82 10.25
30 Sep 82 10.13
12 Oct 82 9.63
01 Nov 82 9.38
02 Nov 82 9.13
26 Nov 82 10.00
12 Jan 83 11.00
15 Mar 83 10.56
13 Apr 83 10.31
14 Apr 83 10.06
13 Jun 83 9.81
14 Jun 83 9.56
09 Aug 83 9.44
10 Aug 83 9.56
03 Oct 83 9.06
07 Mar 84 8.81
14 Mar 84 8.56
10 May 84 9.06
29 Jun 84 8.88
06 Jul 84 10.00
11 Jul 84 12.00
08 Aug 84 11.50
09 Aug 84 11.00
16 Aug 84 10.75
17 Aug 84 10.50
05 Nov 84 10.00
19 Nov 84 9.75
23 Nov 84 9.50
14 Jan 85 11.88
28 Jan 85 13.88
20 Mar 85 13.38
28 Mar 85 12.88
19 Apr 85 12.38
11 Jul 85 11.88
26 Jul 85 11.38
15 Jan 86 12.38
19 Mar 86 11.38
11 Apr 86 10.88
18 Apr 86 10.38
23 May 86 9.88
15 Oct 86 10.88
09 Mar 87 10.38
18 Mar 87 9.88
28 Apr 87 9.38
08 May 87 8.88
06 Aug 87 9.88
23 Oct 87 9.38
04 Nov 87 8.88
03 Dec 87 8.38
01 Feb 88 8.88
17 Mar 88 8.38
08 Apr 88 7.88
17 May 88 7.38
03 Jun 88 7.88
10 Jun 88 8.38
24 Jun 88 8.88
07 Jul 88 9.88
21 Jul 88 10.38
08 Aug 88 10.88
25 Aug 88 11.88
25 Nov 88 12.88
25 May 89 13.75
31 Aug 89 13.84
04 Sep 89 13.88
08 Sep 89 13.75
06 Oct 89 14.88
08 Oct 90 13.88
13 Feb 91 13.38
27 Feb 91 12.88
22 Mar 91 12.38
12 Apr 91 11.88
24 May 91 11.38
12 Jul 91 10.88
04 Sep 91 10.38
05 May 92 9.88
22 Sep 92 8.88
16 Oct 92 7.88
13 Nov 92 6.88
26 Jan 93 5.88
23 Nov 93 5.38
08 Feb 94 5.13
12 Sep 94 5.63
07 Dec 94 6.13
02 Feb 95 6.63
13 Dec 95 6.38
18 Jan 96 6.13
08 Mar 96 5.94
06 Jun 96 5.69
30 Oct 96 5.94
06 May 97 6.25
06 Jun 97 6.50
10 Jul 97 6.75
07 Aug 97 7.00
06 Nov 97 7.25
04 Jun 98 7.50
08 Oct 98 7.25
05 Nov 98 6.75
10 Dec 98 6.25
07 Jan 99 6.00
04 Feb 99 5.50
08 Apr 99 5.25
10 Jun 99 5.00
08 Sep 99 5.25
04 Nov 99 5.50
13 Jan 00 5.75
10 Feb 00 6.00
08 Feb 01 5.75
05 Apr 01 5.50
10 May 01 5.25
02 Aug 01 5.00
18 Sep 01 4.75
04 Oct 01 4.50
08 Nov 01 4.00
06 Feb 03 3.75
10 Jul 03 3.50
06 Nov 03 3.75
05 Feb 04 4.00
06 May 04 4.25
10 Jun 04 4.50
05 Aug 04 4.75
04 Aug 05 4.50
03 Aug 06 4.75
09 Nov 06 5.00
11 Jan 07 5.25
10 May 07 5.50
05 Jul 07 5.75
06 Dec 07 5.50
07 Feb 08 5.25
10 Apr 08 5.00
08 Oct 08 4.50
06 Nov 08 3.00
04 Dec 08 2.00
08 Jan 09 1.50
05 Feb 09 1.00
05 Mar 09 0.50
04 Aug 16 0.25
02 Nov 17 0.50
02 Aug 18 0.75

Information taken from the Bank of England.

Call me for free mortgage advice.

Dan the Mortgage Man

07837 820 894

Interest Rates with Dan the Mortgage Man
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