UK Mortgage Rates Hit Three-Year High Ahead of Rate Hike
Average UK mortgage rates reached 5.89% as lenders anticipate the Bank of England will raise interest rates to 4% on Thursday.
Average mortgage rates in the United Kingdom have climbed to a three-year high of 5.89%, up from 5.83% in October. This increase precedes a scheduled vote by the Bank of England Monetary Policy Committee on November 5, where rates are expected to rise from 3.75% to 4%. This would mark the first interest rate increase since August 2023.
Lenders have already begun adjusting rates due to swap rate volatility and inflation, which reached 3.5% in September. Since January 2026, average two-year fixed rates have risen from 4.83% to approximately 5.97%, while five-year rates have surpassed 6%.
Industry data indicates that roughly 2.3 million households will see their fixed-rate terms expire in 2027, with some borrowers facing annual repayment increases exceeding £2,000. The Office for Budget Responsibility warned that the cost-of-living crisis will likely worsen in 2027, forecasting inflation to rise to 3.75% and unemployment to peak above 5%.
