One in five mortgage holders in Britain will take a financial hit from having to pay more for their mortgages between now and 2024 with about a quarter of the increase caused by the recent market turmoil, a think-tank said over the weekend.

According to the Resolution Foundation, more than five million families will see their annual mortgage payments rise by an average of £5,100 over the next two years.

Of that, around £1,200 reflected the expectations of higher interest rate rises since last month’s ‘mini-Budget’ that prompted a sharp rise in borrowing costs with its unfunded tax cuts.

“With almost half of all mortgagor households on course to see their family budgets fall by at least 5% from higher payments, the living standards pain from rising interest rates will be widespread,” Lindsay Judge, research director at the Resolution Foundation, said.

The Bank of England has raised its benchmark borrowing rate from 0.1% last December to 2.25% now and is expected to announce another big increase on 3 November in a bid to curb high inflation.

The Resolution Foundation said 1.2 million mortgage-holding households on variable rate deals would see their housing costs rise in with Bank Rate while 85% with fixed-rate deals would see their cost build more gradually.