What’s the situation with mortgage rates in 2025?

Over the last few years, we have seen significant fluctuations in the UK mortgage market. Following several base rate hikes by the Bank of England to tackle inflation, rates climbed to levels not seen for over a decade.

However, more recently, there have been signs of stability and even some cautious optimism. Many lenders have adjusted their products in response to changing forecasts about inflation and the Bank of England’s base rate.

At the time of writing:

• The Bank of England’s base rate remains steady, with economists predicting potential reductions in the coming months if inflation continues to ease.
• Some lenders have already started to cut fixed-rate deals slightly, particularly for 2- and 5-year fixed terms.
• Tracker and variable rate deals remain sensitive to any base rate changes, so borrowers on these rates should pay close attention to market movements.

It is worth noting that while rates have come down a little from their peak, they are still higher than the ultra-low deals we saw during the pandemic years.

Should I fix, track, or stay put?

There is no one-size-fits-all answer. The right option depends on your circumstances, risk tolerance, and plans. Here are some things to think about:

Fixed rates:

A fixed-rate mortgage can give you peace of mind by locking in your monthly repayments for a set period. This could be appealing if you want certainty in your budgeting.

Tracker or variable rates:

If you believe the base rate may drop, you might be tempted by a tracker deal, but remember your payments can go up as well as down.

Stay put (for now):

If you are on a competitive deal with time left on your fixed term, it is still worth reviewing your options. Some lenders allow you to secure a new deal up to six months before your current one ends.

Why get advice now?

Many borrowers are feeling uncertain, but the worst thing you can do is bury your head in the sand. A quick chat with an experienced mortgage adviser can help you:

Understand what rates you could qualify for

• Compare deals from a wide range of lenders
• Lock in a competitive rate early, especially if you are coming to the end of a fixed term
• Make a plan that suits your budget and goals

Even if you do not switch straight away, you will feel more prepared for what’s ahead and that peace of mind is invaluable.

Let’s talk about your mortgage

Every household’s situation is unique. That is why personalised advice is so important, especially in a market that’s moving quickly.

If you would like to find out what current mortgage rates mean for you, and whether you could save money or secure a better deal, get in touch for a no-obligation review.

Although every effort has been made to ensure that the information provided in this article is accurate and correct, the information provided does not constitute any form of financial advice. We recommend that you seek mortgage advice from a regulated mortgage adviser before making any mortgage decisions.