£500k+ mortgages shift North despite higher cost of borrowing: Savills – Mortgage Strategy

Growth in £500,000-plus borrowing is increasingly being driven by buyers outside Southern England, Savills reveals.

Savills analysis of FCA lending data reveals that London remained the largest market for high-value borrowing in 2025, accounting for 42% of all £500,000-plus mortgages.

However, the number of such loans has fallen by 2.4% since 2021 in the capital, with a further 2.3% decline across the South East.

By contrast, £500,000-plus mortgages have increased by 17% in the Midlands, 16% in the North of England and 28% across Scotland, Wales and Northern Ireland over the same period.

Overall, the number issued outside Southern England has risen by 18%.

It found that 62,391 mortgages of £500,000 or more were issued in 2025, accounting for 5.8% of all mortgage lending.

While this was 24% higher than in 2024, it remains below the market peak seen in 2022 when it was 9% lower.

Savills says the trend reflects how rising house prices and growing levels of housing equity have pushed larger borrowing requirements into markets where they were once far less common.

But this growth has come despite a sharp rise in the cost of servicing larger loans.

Savills research reveals that the annual cost of servicing a new £500,000 mortgage increased from £25,100 in August 2021 to £34,100 in August 2026, rise of 36%.

Savills head of residential research Lucian Cook says: “The half-million-pound mortgage is no longer solely the preserve of buyers in London and the South East.”

“While those markets still account for the largest share of high-value lending, growth over the past five years has increasingly come from elsewhere in the country as rising house prices and accumulated housing equity have enabled more households to take on larger loans.”

“Despite higher borrowing costs, greater flexibility in affordability stress testing has helped more higher-earning households access mortgages of £500,000 and above.”

“At the very top end of the market, private banks can often take a more flexible and innovative approach than mainstream lenders, broadening access to larger loans.”