UK Mortgage Rates Hit 5.29% as Home Sales Drop 9%
Two-year fixed mortgage rates have climbed to 5.29%, adding roughly £180 to monthly payments while annual sales agreed fall by 9%.
Key points
- Two-year fixed mortgage rates reached 5.29%, increasing typical monthly payments by £180.
- Sales agreed fell 9% annually while housing supply hit a twelve-year high for September.
- The Bank of England held Bank Rate at 3.75% for the sixth time.
The average two-year fixed mortgage rate has risen to 5.29%. This increase from 5.09% in August directly raises monthly payments by approximately £180.
Housing demand is 9% lower than last year despite seasonal patterns. Sales agreed have fallen by the same margin according to Rightmove data.
Market supply reaches twelve-year high
Homes for sale are at a twelve-year high for this time of year. New listings are 3% lower annually but total supply remains elevated.
Sellers take an average of 64 days to find a buyer. An additional 150 days are needed to complete the transaction.
Only 61% of homes find a buyer compared to 74% in 2021. London sees the lowest success rate at 42% for sold properties.
Bank of England holds rates steady
The Bank of England kept Bank Rate at 3.75% on September 17. This marks the sixth consecutive decision to hold rates unchanged.
Three MPC members voted for a rise to 4% instead. The next monetary policy decision is scheduled for November 5.
Major lenders raised rates before the vote as swap rates climbed. Halifax and Nationwide adjusted pricing twice within a single week.
Asking prices show modest recovery
Average asking prices rose 0.7% to £367,440 in September. This is the first monthly increase since May according to Rightmove.
