Fixed-rate home loans in the UK now cost more than at any point in roughly three years. According to Moneyfacts, the financial data firm, the average five-year fixed mortgage rate reached 6% on Monday 5 October, the first time it has been at that level in about three years. The average two-year fix rose to 5.98% that morning, from 5.96% on Friday 2 October, which Moneyfacts said is its highest since mid-December 2023.

The cheapest part of the market has almost gone. Moneyfacts counted nearly 1,500 fixed-rate products priced below 5% at the start of September and nine on 5 October, leaving out deals available only for lending in Northern Ireland. Variable-rate deals below 5% held up far better over the same period, slipping from 411 to 389. Several of the largest lenders repriced more than once in September. Barclays raised selected fixed rates four times, and HSBC, Lloyds Bank, Nationwide, Santander and TSB did so three times each.

Moneyfacts tied the increases to swap rates, the wholesale rates that underpin how lenders price fixed loans. It said swap rates had climbed as conflict in the Middle East put pressure on oil supplies and fed inflation concerns, while a global bond sell-off pushed the UK 10-year gilt yield to an 18-year high. The policy rate has not changed. The Bank of England held Bank Rate at 3.75% at its decision published on 17 September, with consumer price inflation at 3.1% against its 2% target, and its next decision is due on 5 November. The Bank's own summary of that decision notes that mortgage rates for households are higher than before the conflict.

The difference shows up quickly in a monthly payment. On an illustrative £500,000 repayment mortgage over 25 years, a 5% rate gives a monthly payment of about £2,923 and a 6% rate about £3,222. That is about £299 more each month, or roughly £3,580 a year, an increase of a little over 10%. These figures come from a standard repayment formula and leave out arrangement fees, so they are not a quote from any lender.

A borrower who earns in another currency and repays in sterling also carries the exchange rate. Using the European Central Bank's euro reference rates, one pound was worth about US$1.3531 on 1 September and US$1.3276 on 6 October, a fall of about 1.9%. Against the Singapore dollar it went from about S$1.7231 to S$1.6956. For someone earning in US dollars, the slightly weaker pound offset part of the rise, so in the example above the monthly payment went up by about 8% in dollar terms rather than 10%. A fixed rate holds the sterling payment steady for its term. It does not hold the cost in dollars or Singapore dollars, which moves with the exchange rate each month.

The Moneyfacts figures are averages across the UK residential mortgage market. They are not broken out for buyers who live outside the UK, and an individual offer depends on the lender, the deposit, the fees and the borrower. Moneyfacts also noted that borrowers coming to the end of a fixed deal can often secure a new one some months before the existing deal ends. Third-quarter prices in prime central London are covered in Prime central London prices rise for the first quarter in four years on Knight Frank's index, and central bank moves are tracked on Rate decisions.

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Sources

Sources read 7 October 2026 (SGT).

  • Latest UK Mortgage Trends: Average 5-Year Fixed Mortgage Rate Hits 6%, Moneyfactscompare.co.uk, Ella Mower, published 5 October 2026 (page modified 5 October 2026). Supports the five-year average of 6%, the two-year average of 5.98% (5.96% on 2 October, highest since mid-December 2023), nearly 1,500 sub-5% fixed deals at the start of September down to nine (excluding Northern Ireland-only deals), variable sub-5% deals 411 to 389, the lender repricing counts, the swap-rate and 10-year gilt explanation, and the early-switch point.
  • Interest rates and Bank Rate: our latest decision | Bank of England – the UK's central bank, Bank of England, decision published 17 September 2026 (page last updated 18 September 2026). Supports Bank Rate held at 3.75%, inflation of 3.1% against the 2% target, the next decision due 5 November 2026, and mortgage rates for households higher than before the conflict.
  • Euro foreign exchange reference rates, European Central Bank, including the 90-day history file linked from that page. Supports EUR/USD, EUR/GBP and EUR/SGD for 1 September and 6 October 2026; sterling crosses calculated by Realtopedia.