Getting on the property ladder and moving home is usually stressful throughout the buying process, and that includes opting for the best time to get a mortgage.
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Here we look at what some of the circumstances are that could impact mortgage rates, the latest figures and an exclusive snapshot of what industry experts think mortgage rates could reach towards the end of the year.
The Independent also has tables below, from personal financial website NerdWallet UK, outlining how much your bills could go up or down by in different rates scenarios.
What could impact mortgage rates?
The Bank of England’s Bank Rate, currently 4.5 per cent, is the core UK interest rate and influences the rates commercial banks and building societies charge their own customers. The BoE moves rates up and down to control UK inflation.
For existing borrowers on a fixed rate deal, payments are already set so typically won’t be impacted by Bank Rate changes, but those on tracker rates could see lower or higher repayments depending on which way the base rate moves.
For a standard variable rate, which is an interest rate set by lenders that customers usually move to when a current mortgage deal ends (unless a new agreement is secured), a base rate change could also impact payment amounts.
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Swap rates are different to the Bank Rate and are based on what financial markets think will happen to the economy and future interest rates. These rates impact the pricing of fixed rate mortgages. If swap rates climb so could certain mortgages, but if they fall customer payments may also potentially decline.
Marcus Dixon, director of UK residential research at property agent JLL says: “It is difficult to find a forecaster who doesn’t think that the Bank rate will be lower at the end of 2025 than the start. What differs, and where the uncertainty lies is around the pace and timing of future falls, with uncertainty around the impact of Trump’s tariffs further muddying the waters.”
Where we are now
The average two-year fixed mortgage rate across all LTVs as at late April 2025 was 5.23 per cent and the average five-year for all LTVs was 5.12 per cent, according to financial product price comparison site Moneyfacts.
Verona Frankish, who leads estate agency Yopa, says: “The mortgage rates offered by lenders are, of course, influenced by the wider economic landscape and subject to change from one month to the next.”
A host of companies have this month reduced rates on certain ranges with several offering sub-four per cent rates on some products.
Mortgage rate predictions from market experts
Crystal balls around cuts and hikes will always be tricky, as economic and political environments can change rapidly.
But to give a snapshot of where a host of industry experts think rates could go, The Independent has polled 12 respondents (representatives from JLL, Jeremy Leaf, SPF Private Clients, Yopa, Alexander Hall, Carter Jonas, Jackson-Stops, Cluttons, Winkworth, Yellow Brick Mortgages, Tembo Money, EHF Mortgages) about forecasts for the end of the year.
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Following the Chancellor’s Spring statement in March, the average two-year fixed rate across all LTVs was 5.33 per cent and the average five-year for all LTVs was 5.18 per cent, Moneyfacts data shows.
Those figures in December 2025 could respectively be 4.31 per cent and 4 per cent, based on the mean figures from the responses provided by the mixture of researchers, mortgage brokers and estate agents surveyed.
How much could monthly mortgage payments change?
Amy Knight, personal finance expert and mortgage spokesperson at NerdWallet UK says: “The path of UK interest rates this year is difficult to predict. However, by analysing recent data, we can provide estimates to show the potential impact of base rate moves on British homebuyers.”
Below, we provide NerdWallet UK mortgage rate scenario predictions for 2025 in a series of tables.
For first-time buyer deals, assumed data is an average FTB property price of £311,034, with an average deposit of £61,090 and a median term of 30 years. For home-movers or standard buyer deals, data is for a property price of £370,500 with an average deposit of £48,350 and a median term of 26 years.
2025 mortgage scenarios: 2 year fixed deals for a first-time buyer
Bank of England decision
Base Rate
Estimated average rate (two year fix)
New monthly repayment
Annual change from current repayment of £1317.42 per month
Cut base rate once in 2025 if tariffs result in deflation
4.25%
Could decrease to around 4.5%
£1,266.43 (if avg rate drops to 4.4%)
- £65.80 per month
Saving £784.80
Cut the base rate twice this year to boost UK growth
4%
Could fall to around 4.1%
£1,207.63 (if avg rate drops to 4.1%)
- £109.79 per month
Saving £1,221.48
Hold the base rate
4.5%
Likely to remain stable around current average
£1326.52 (if avg rate increases to 4.9%)
No meaningful change
Raise base rate once if tariffs drive inflation
4.75%
Could increase to around 5.2%
£1372.47 (if avg rate increases to 5.2%)
+£55.05
Additional £660.60
5 year fixed deals for a first-time buyer
BoE decision
Base Rate
Estimated average rate (five year fix)
New monthly repayment
Annual change from current repayment of £1,299.31 per month
Cut once
4.25%
Could drop to around 4.4%
£1251.62 (if avg rate drops to 4.4%)
-£47.69 per month
Saving £572.28
Cut twice
4%
Could drop to around 4%
£1193.27 (if avg rate drops to 4%)
£106.42 per month
Saving £1,277.04
Hold
4.5%
Likely to remain stable
around current average
£1299.31 (if avg rate hits 4.8%)
No meaningful change
Raise once
4.75%
Might rise to 5.1% balancing future rates expectations
£1357.07 (if avg rates rise to 5.1%)
+£57.76 per month
Additional £693.12
2 year fixed deals for a home-mover
BoE decision
Base Rate
Estimated average rate (two year fix)
New monthly repayment
Annual change from current repayment of £1,794.33 per month
Cut once
4.25%
Could decrease to 4.44%
£1742.42
-£51.91 per month
Saving £622.92
Cut twice
4%
Could fall to around 4.04%
£1669.64
-£124.69 per month
Saving £1,469.28
Hold
4.5%
Likely remain stable around
current average
£1794.33
No meaningful change
Raise once
4.75%
Could increase to around 5.14%
£1873.66
+£79.33 per month
Additional £951.96
5 year fixed deals for a home-mover
BoE decision
Base Rate
Estimated average rate (five year fix)
New monthly repayment
Annual change from current repayment of £1,794.33 per month
Cut once
4.25%
Could drop to around 4.42%
£1738.74
-£55.59 per month
Saving £667.08
Cut twice
4%
Could drop to around 4.12%
£1684.06
-£110.27 per month
Saving £1,323.24
Hold
4.5%
Likely remain stable around
current average
£1794.33
No meaningful change
Raise once
4.75%
Could rise to around 5%
£1847.03
+£52.70 per month
Additional £632.40
Average mortgage rates for 2- and 5-year fixed deals are based on figures from Rightmove and correct as of April 2025. All monthly repayment figures calculated using NerdWallet UK’s Mortgage Calculator. Estimates for how base rate decisions by the MPC could impact mortgage rates have been made by NerdWallet UK mortgage and personal finance experts using appropriate loan-to-value (LTV) ratios.
For first-time buyers, the average house price and average deposit are taken from analysis by Halifax in February 2025. The median mortgage term for FTB is taken from online mortgage broker Better.co.uk in March 2025. For homemovers (standard purchases), data from Better.co.uk has been used to provide the median house price, median deposit and median mortgage term.
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