However, higher borrowing costs could eat into that support for some households, with increased mortgage repayments potentially outweighing savings elsewhere in the family budget.
Mortgage borrowers face higher repayments
Around 510,000 tracker mortgage borrowers face higher repayments because their interest rates follow the Bank’s base rate.
UK Finance calculated that the quarter-percentage-point increase would add £31 a month to a typical tracker mortgage.
Another 470,000 borrowers on variable deals will need to wait for their lender to decide whether to increase their rate. A matching rise would typically add £14 to monthly repayments.
Borrowers on fixed-rate mortgages will see no change to their payments during their existing deal. However, those approaching the end of a fix could face a substantially higher bill when they refinance.
As of November 4, the average two-year fixed residential mortgage rate was 5.96 per cent, while the average five-year rate stood at 5.99 per cent, according to Moneyfacts.
Some of the expected Bank Rate increase was already reflected in the pricing of new fixed deals.
Broker L&C said some borrowers refinancing a £200,000 mortgage over 25 years could pay almost £5,000 more a year than those who secured a deal in 2021. Its comparison was based on rates offered by the 10 biggest lenders.