Fixed rates rise in UK for first time since February
Average rates for two- and five-year fixed mortgages have increased month-on-month for the first time in eight months, according to the latest Moneyfacts UK Mortgage Trends Treasury Report.
The average two-year fixed rate now stands at 4.98%, and the five-year fixed at 5.02%, both up by 0.02% from the previous month. This is the first month-on-month increase since February 2025.
Over the past year, shorter-term fixed rates have seen more significant reductions, with the average two-year fixed rate falling by 0.42 percentage points since October 2024, compared to a 0.05 percentage point decrease for five-year fixes.
The Moneyfacts Average Mortgage Rate has also risen to 5.02%, up from 5% last month. Despite this, it remains below the 5.30% recorded in October 2024 and well under the 6.21% seen in October 2023.
The average shelf-life of mortgage products has increased to 22 days, up from 17 days the previous month, and is the first time it has exceeded 20 days since April 2025.
Variable rates have also shifted, with the average two-year tracker rising to 4.67%. Meanwhile, the average standard variable rate (SVR) has dropped to 7.27%, down from the peak of 8.19% observed in late 2023.
The overall number of mortgage products has declined to 6,998, but the combined total number of deals available at 95% and 90% loan-to-value has reached 1,362, the highest level since March 2008.
“Borrowers may well be disappointed to see fixed mortgage rates on the rise,” said Rachel Springall (pictured right), finance expert at Moneyfacts. “Volatile swap rates and a cautionary approach among lenders have led to an abrupt halt in consecutive monthly average rate falls.
“There may be little margin of rate movement from lenders in the coming weeks, prolonging the subdued sentiment. Inflation is expected to peak at 4%, which would then be double the desired 2% target, so any imminent base rate cuts by the Bank of England seem unlikely. However, even with the three base rate cuts since the start of 2025, fixed mortgage rates can move up regardless, such as in reaction to volatile swap rates.
Springall, however, pointed out that not all is doom and gloom for borrowers, as the mortgage market has shown how far it has improved over recent years. “Borrowers who locked into a two-year fixed rate deal back in October 2023 would have been paying 6.47% in interest on average, compared to 4.98% now,” she said. “That is a difference of £225 per month in repayments on a £250,000 mortgage over 25 years.”
According to Springall, the repercussions of rising fixed rates and subdued sentiment stifle the Government’s push for lenders to do more to boost UK growth. However, even with a slight dip in product choice across the mortgage spectrum, the combined quantity of deals available to borrowers with a 5% or 10% deposit or equity stands at a 17-year high.
“The relaxation of loan-to-income rules is a positive step for improving mortgage affordability challenges, but first-time buyers are still waiting for more affordable housing to be built,” Springall added.
“Whether purchasing or refinancing, it remains essential borrowers seek independent advice to navigate the mortgage maze and not feel pressured to secure a deal because of the Budget rumour mill.”
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