UK mortgage rates have begun falling following the Bank of England rate-cutting cycle. The average two-year fixed rate has fallen to approximately 4.5%, down from a peak of 6.3% in late 2023.
Bank of England Outlook
The MPC has cut the base rate to 4.25%. Market expectations point to around 3.5% by end-2026, though these forecasts carry significant uncertainty.
Remortgage Decisions
For the 1.5 million households whose fixed-rate deals expire in 2026, the question is whether to fix now or track the base rate downward. Fixing now provides certainty; tracking benefits from further cuts.
First-Time Buyers
Government Help to Buy schemes have ended but mortgage guarantee schemes and shared ownership remain available.
Best Buys
For borrowers with 40% equity or more, rates below 4% are available from challenger lenders. Smaller deposits attract higher rates reflecting lender risk.
