May 9, 2024 11:04 am

Insert Lead Generation
Nikka Sulton

The current landscape of mortgage costs paints a concerning picture, with a gradual but steady rise prompting renewed calls for the Bank of England and Governor Andrew Bailey to reassess the base rate ahead of their forthcoming announcement on Thursday. As mortgage expenses continue to climb, the pressure mounts on the central bank to respond effectively, particularly in light of recent developments in the financial market. Against this backdrop, there’s a palpable sense of urgency for policy adjustments to alleviate the strain on homeowners and support broader economic stability.

The escalation in mortgage expenses coincides with a cautious approach adopted by the Bank’s Monetary Policy Committee, which remains vigilant in its assessment of inflationary trends before contemplating any substantive policy changes. However, the recent implementation of rate hikes by major lenders such as Santander, Natwest, and Nationwide underscores the immediate challenges faced by mortgage holders, accentuating the need for proactive measures to address the growing financial burden.

As the Bank of England grapples with the impending decision on interest rates, the sustained increase in mortgage costs serves as a stark reminder of the pressing need for decisive action. With the impact of rate hikes reverberating across the housing market, there’s a growing chorus of calls for the central bank to intervene and mitigate the adverse effects on borrowers. Against this backdrop, expectations are high for the Monetary Policy Committee to navigate the complexities of the current economic landscape and deliver policies that strike a balance between addressing immediate concerns and fostering long-term stability.



In March, the Bank maintained the base interest rate at 5.25%, with an almost unanimous decision despite a drop in inflation to 3.4%, later reaching 3.2%. Governor Andrew Bailey stated that it wasn’t the appropriate time to reduce interest rates, citing “further encouraging signs” of declining inflation. Bailey emphasized the importance of ensuring that inflation not only reaches but also remains at the government’s target of 2%.



According to the latest tracker data from Rightmove, mortgage rates are on the rise. The average 5-year fixed rate stands at 4.97%, while the two-year fixed rate is at 5.38%.

Matt Smith, Rightmove’s Head of Product (Mortgages), emphasizes the significance of the upcoming Bank of England meeting. He suggests that the meeting will play a crucial role in setting the tone for mortgage rates as we head into the summer.


“There is still a lot of uncertainty around when we might see the first interest rate cut.”


“There’s been notable unease in the global economy recently, leading to ongoing uncertainty regarding the timing of the first interest rate cut. This uncertainty, coupled with other factors, has resulted in an increase in average mortgage rates,” he explains.

“However, despite these increases, it doesn’t seem like we’re witnessing the same level of rate spikes as we did this time last year.”



– The average 5-year fixed mortgage has risen to 4.97% from 4.48% a year ago.

– The average 2-year fixed mortgage now stands at 5.38%, up from 4.78%.

– For an 85% Loan-to-Value (LTV) 5-year fixed mortgage, the average rate has climbed to 4.90% from 4.44%.

– Similarly, for a 60% LTV 5-year fixed mortgage, the average rate has increased to 4.50% from 4.17%.





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