Mortgage Rates Rise Amid Bank of England Rate Cuts

Despite two Bank of England base rate cuts since October 2024, UK homeowners have seen average mortgage rates rise rather than fall, while savers have suffered even steeper reductions in returns. Research from Finder reveals that, although the central bank’s base rate dropped by 0.5 percentage points, the average rate on a two-year fixed mortgage with a 25% deposit actually increased, and similar trends were seen in five-year deals. Meanwhile, savings rates dropped at more than twice the pace of the base rate cuts, leaving savers significantly worse off. Experts note that while consumers might expect relief from lower mortgage rates following base rate reductions, both borrowers and savers have instead lost out. Recent signs of easing mortgage rates, partly linked to geopolitical developments such as US tariffs, may offer some hope, but experts caution the relief could be short-lived amid ongoing economic uncertainty. As a result, consumers are advised to shop around for the best mortgage or savings deals and to carefully consider their options in a volatile market.