The Current Outlook for UK Mortgage Rates

Introduction

After months of uncertainty, many homeowners and buyers are asking the same question: what’s really happening with mortgage rates right now — and is it the right time to fix?

At Mortgage Pro Sussex, we’ve been monitoring the latest market changes closely. In this post, we’ll explain the current outlook for UK mortgage rates, what’s driving them, and what this means for you if you’re planning to buy, move, or remortgage in the coming months.

1. Where are mortgage rates right now?

  • The Bank of England base rate currently stands at around 4.0 %, following several cuts earlier this year.
  • Despite this, average fixed mortgage rates have only fallen slightly. As of October 2025, two-year fixed rates are averaging around 4.9 %, while five-year deals are roughly 5.0 %.
  • The market remains volatile, with lenders adjusting products almost weekly as funding costs shift.

At Mortgage Pro Sussex, we’re seeing more competitive options emerging — particularly for borrowers with strong equity or lower loan-to-value (LTV) ratios.

2. What’s driving today’s rates?

Mortgage rates are influenced by several key factors:

  • Bank of England policy: The base rate drives the cost of borrowing for lenders. With inflation easing, the Bank is expected to continue trimming rates cautiously through late 2025.
  • Swap rates: Lenders fund fixed-rate mortgages through the “swap market”. These wholesale costs remain unpredictable, keeping mortgage pricing higher than many hoped.
  • Lender confidence: Economic stability and housing-market activity affect how competitively lenders price their products. Increased buyer demand in autumn 2025 has encouraged some to re-enter the market with sharper rates.

3. What’s the forecast for the months ahead?

Market analysts generally expect mortgage rates to edge down slowly over the next 6–12 months. The base rate could fall towards 3.5 % by early 2026, but any reductions are likely to be gradual.

In short — we’re moving in the right direction, but don’t expect a dramatic drop. Borrowers hoping for ultra-low “pandemic-era” rates will probably be waiting a long time.

4. What does this mean for you?

✅ If you’re buying your first home

The recent easing in rates may improve affordability slightly — but with strong demand across Sussex and the South East, house prices remain resilient. Securing an Agreement in Principle early ensures you’re ready to act when you find the right property.

🔄 If you’re remortgaging

Don’t wait until your fixed deal ends. Many lenders allow you to secure a new rate up to six months in advance — locking in protection against potential market rises. A shorter 2- or 3-year fix might suit if you believe rates will fall further; a 5-year deal offers long-term stability.

💡 If you’re on a tracker or variable rate

With the base rate expected to drop gradually, it may be worth staying put for now — but keep a close eye on your lender’s reversion rate. Mortgage Pro Sussex can model different scenarios so you can see what a switch could save you.

5. Four key tips to navigate this market

  1. Know your end date: When does your fixed deal expire? What will you move onto?
  2. Compare LTVs and fees: The headline rate matters, but so do fees, product terms and how your LTV affects pricing.
  3. Fit the fix-length to your plans: If you might move or remortgage soon, a shorter fix may suit. If you plan to stay long-term, security might matter more than chasing the lowest rate.
  4. Speak to a mortgage broker: They can help you assess the market, check deals you might not see publicly, and advise on whether locking in now vs waiting makes sense given your personal circumstances.

Conclusion

The mortgage-rate outlook in the UK for late 2025 and beyond is a mixture of gradual optimism and caution. While base and mortgage rates may ease over the next 12–18 months, they’re unlikely to plummet quickly given inflation, lender costs and economic uncertainty. That means for many borrowers now is a window to act, rather than simply waiting indefinitely for the “perfect moment”.

Whether you’re buying, remortgaging or adjusting from a variable rate, the key is to understand your timeline, risk tolerance, and affordability—and to work with a trusted broker to tailor your decision. Rates may edge lower, but being prepared and proactive will usually serve you best.

Talk to our team today
For clear, friendly mortgage advice across Sussex and beyond, contact Mortgage Pro Sussex for a free, no-obligation consultation.