How much of your monthly home cost is council tax?
Ask most buyers what will drive their monthly outgoings and they picture the mortgage. Council tax tends to be an afterthought — a bill that arrives, gets paid, and rarely gets compared between one home and the next. But when you put the two numbers side by side, a clear pattern emerges: council tax is a real slice of the monthly cost, and it is at its largest on the cheapest homes.
For a home bought at the national average price of £300,000 in 2026, council tax works out at roughly one pound in every seven of the combined mortgage-and-council-tax bill. On a £150,000 home it is closer to one pound in four. On a £750,000 home it drops to about one pound in sixteen. The share falls steadily as the price rises — and the reason is simple arithmetic, explained below.
The numbers
The table below holds two things constant to isolate the effect of price. Mortgage figures assume a 25% deposit (a 75% loan-to-value loan) over a 25-year term at the most recent Bank of England quoted rate for a five-year fix at 75% loan-to-value (4.32%, April 2026). Council tax is held at the national average Band D of £2,410.97 for 2026-27 across England's 296 billing authorities (gov.uk). "Monthly cost" here means mortgage plus council tax only — it excludes energy, insurance, maintenance and the one-off stamp duty bill.
| Purchase price | Mortgage (approx.) | Council tax | Combined monthly | Council tax share |
|---|---|---|---|---|
| £150,000 | £614/mo | £201/mo | £815/mo | 24.7% |
| £200,000 | £818/mo | £201/mo | £1,019/mo | 19.7% |
| £300,000 | £1,228/mo | £201/mo | £1,429/mo | 14.1% |
| £500,000 | £2,046/mo | £201/mo | £2,247/mo | 8.9% |
| £750,000 | £3,069/mo | £201/mo | £3,270/mo | 6.1% |
Mortgage figures are approximate and for illustration only — your actual rate depends on your lender, deposit and credit profile. Based on 30.98M HM Land Registry transactions, gov.uk 2026-27 council tax Band D, and Bank of England quoted rates. See more buyer guides.
Why the share falls as prices rise
The mortgage and the council tax bill are set by two entirely different mechanisms, and they scale at very different speeds.
The mortgage is a percentage of the amount borrowed, so it rises almost in step with the purchase price. Double the price and — deposit percentage held equal — you roughly double the monthly payment. Between the £150,000 and £750,000 rows above, the monthly mortgage rises fivefold, from around £614 to around £3,069.
Council tax does not work that way. It is banded, not proportional. Every home in England sits in one of eight bands (A to H), and each band is charged a fixed fraction of the Band D figure — Band A is six-ninths of Band D, Band H is eighteen-ninths, or exactly double. So across the entire band range, from the cheapest Band A to the most expensive Band H, council tax varies by at most three times. Price and mortgage can vary by five, ten or twenty times over the same set of homes. When one number grows far faster than the other, the slower one becomes a shrinking share of the total. That is the whole story. It helps to understand how council tax bands are set before you compare areas.
The honest caveat: a dearer home usually sits in a higher band
The table above deliberately held council tax at Band D for every price so the price effect stands out. In practice, a more expensive home usually sits in a higher band, so its council tax would be higher than shown. It is fair to ask whether that cancels the taper out. It does not.
If you let the band rise with the price — Band A on a cheap home, up through Band G on an expensive one — the share still falls, just more gently:
| Purchase price | Illustrative band | Council tax | Council tax share |
|---|---|---|---|
| £150,000 | Band A | £134/mo | 17.9% |
| £200,000 | Band B | £156/mo | 16.0% |
| £300,000 | Band D | £201/mo | 14.1% |
| £500,000 | Band F | £290/mo | 12.4% |
| £750,000 | Band G | £335/mo | 9.8% |
Even on a £750,000 home in Band H — twice the Band D charge, around £402 a month — council tax would still be only about 12% of the combined monthly bill, because the mortgage on that home runs past £3,000 a month. The direction of travel is the same whichever way you slice it: council tax is a bigger share of the monthly cost for cheaper homes and a smaller one for dearer homes.
Where council tax actually varies — and by how much
None of this means council tax is trivial or that it never moves the needle. It varies sharply by area, and for two similarly priced homes in different authorities the difference is real money. Across the 296 English billing authorities, the Band D charge for 2026-27 runs from £1,028.21 in Wandsworth — the lowest in the country, about £86 a month — to £2,765.02 in Dorset, about £230 a month (gov.uk). That is a spread of roughly £145 a month, or £1,737 a year, on the same band.
So the practical point for someone comparing two areas is that council tax is worth checking, but it rarely reverses which home is cheaper to run overall — the mortgage difference between two price points is usually larger than the council tax difference between two areas. To see the exact Band D and the estimated all-in monthly cost for real streets, you can check the True Cost of any UK street by postcode, and compare the cheapest and most expensive council tax areas in England side by side.
What this means when you are budgeting
If you are working out what a move will cost each month, the figures above suggest where to focus. The mortgage is the number that most determines the monthly outgoing, and it moves with the price you pay and the rate you secure. Council tax is a smaller, steadier line — meaningful, area-specific, but rarely the deciding factor. For the full breakdown of the buying and running costs on a typical mid-market home, the guide to the true cost of buying a £300,000 home works the mortgage, stamp duty, council tax and energy through together.
Council tax bands, mortgage rates and eligibility rules all interact with your own circumstances. Speak to a qualified adviser before acting.