UK mortgage rates have surged past 6% for the first time in three years, with five-year fixed deals now averaging 6.00%—the highest since late 2023—while two-year rates have also climbed to their peak since December of the same year. The sharp rise follows growing instability in bond markets, which has pushed lenders to increase borrowing costs as funding becomes more expensive. Financial data from Moneyfacts highlights the steepening trend, signaling potential further hikes if economic uncertainty persists. Homebuyers and refinancers are facing significantly higher monthly payments amid the shifting financial landscape.
Banks and building societies raise prices as turmoil in bond markets increases expectations of base rate riseThe average cost of a five-year fixed-rate mortgage has hit the 6% barrier for the first time in three years, as jitters in the money markets make the loans more expensive for lenders to offer.Figures from financial information provider Moneyfacts show the average is now 6.00%, its highest point since September 2023, while the average two-year fixed rate is not far behind at 5.98%, its highest since December of the same year. Continue reading...
