The Bank of England produce a nice measure of lending rates called the quoted mortgage rate. It is calculated as a weighted average of fixed-rate and tracker products, assuming a 75 percent LTV.
As the chart illustrates, mortgage costs have been creeping. More ominously for the Bank of England,those two recent rate cuts had virtually no effect on the rates charged by banks. Effective monetary policy depends on the central bank affecting all interest rates by changing short term rates. Those daft enough to call for a monetary policy easing would do well to take a look hard look at this chart.
There is an another interesting issue behind this chart. Up to now, the credit crunch, and in particular, the collapse of mortgage approvals has been described as a supply side problem. Banks, the suppliers of credit, have been unable to find wholesale funding, and this has restricted the amount of credit available. However, the higher rates must have also priced out potential home buyers.
Of course, there is nothing like higher mortgage rates for killing off a housing bubble.
(For those with vague acquaintance with supply and demand analysis, the supply function has shifted upwards and along the demand curve.)