Bank Rate reaches 4%: what the move means for buyers and homeowners
The Bank of England has raised the Base Rate from 3.75% to 4%, its first increase in more than three years. For buyers and homeowners nearing the end of a mortgage deal, the headline is clear; the effect on any one mortgage is less straightforward. Fixed rates don’t automatically rise when Base Rate does, and the size of the deposit, loan terms and wider market all shape what borrowers are offered.
Matt Smith, Rightmove’s mortgage expert, says the increase was widely anticipated. That matters: lenders can account for expected rate moves before the Bank announces them. Here’s what the decision may mean for fixed-rate borrowers, tracker customers, first-time buyers and people preparing to remortgage.
For background on current mortgage rates and mortgage affordability, see Rightmove’s guides.
Fixed rates have already absorbed some expectations
A Base Rate increase doesn’t translate directly into a matching jump in fixed mortgage rates. Those rates respond to financial markets and expectations about future interest rates, so lenders often adjust their offers ahead of a Bank decision. Since this increase was expected, its announcement alone may not bring a significant fresh rise in fixed-rate costs.
Smith says some major lenders made small cuts to fixed rates during the week, though early reductions may be aimed mainly at borrowers with the largest deposits. The wider economic picture still matters: changing inflation and interest-rate expectations, global events and market movements can all affect lenders’ funding costs. It’s hard to pin any one rate change on the Bank’s decision alone.
The broader direction has been costly for people moving home. Smith estimates that, compared with the start of the year, a typical flat buyer could face about £150 more a month on a new mortgage, while someone buying a detached home could pay around £350 more.* The headline Base Rate move may be expected; those monthly increases are harder to shrug off.
Average rates for 2-year and 5-year fixed-rate mortgages
| Term | Average rate | Weekly change | Yearly change |
|---|---|---|---|
| 2-year fixed | 5.51% | -0.03% | +1.07% |
| 5-year fixed | 5.48% | -0.03% | +1.01% |
Updated November 7, 2026. Rates supplied by Podium, averaged across 95% of the mortgage market, and based on products with a fee of about £999.
Lowest rates for 2-year and 5-year fixed-rate mortgages
| Term | Lowest rate | Weekly change | Yearly change |
|---|---|---|---|
| 2-year fixed | 4.78% | +0.00% | +1.12% |
| 5-year fixed | 4.89% | -0.04% | +1.05% |
Updated November 7, 2026. Rates supplied by Podium, averaged across 95% of the mortgage market, and based on products with a fee of about £999.
Tracker borrowers may feel the increase sooner
Tracker mortgages usually follow Base Rate plus a set margin, so a rise can feed through to monthly payments, depending on the terms of the individual loan. That makes the effect more immediate than it is for someone on a fixed deal.
There’s a trade-off. As of November 5, minimum tracker rates for borrowers with a 90% loan-to-value mortgage started at 4.48%, compared with 5.24% for a similar two-year fix and 5.25% for a five-year fix. Trackers can look cheaper today, but another Base Rate rise could narrow that gap. Smith says lenders have already priced in expectations of further increases after November, including possible moves in 2027, when setting fixed rates.
If you’re comparing a tracker with a fixed deal, look at what another rise would do to your monthly budget and whether the mortgage lets you switch to a fixed product later. Smith says tracker rates are currently below fixed rates across most loan-to-value bands, which may make them worth considering for some borrowers. The right choice depends on your circumstances and tolerance for payments that can change.
Read more about the different types of mortgages.
What first-time buyers should weigh up
For first-time buyers, this decision doesn’t mean fixed mortgage offers will suddenly become more expensive tomorrow. A lender’s offer depends on the borrower’s circumstances, and deposit size is a major part of the picture: buyers borrowing a smaller share of a property’s value may qualify for different rates from those with smaller deposits.
Smith recommends getting three things into focus: what homes and asking prices are available locally, how much deposit and budget you have, and how much you may be able to borrow. Then compare mortgage deals against the costs you can actually manage:
- Monthly budget: Consider how different payments would fit into your finances.
- Income and outgoings: A fixed rate offers payment certainty; a tracker could change what you pay each month.
- Total deal cost: Product fees and other charges can make similar-looking mortgages cost quite different amounts overall.
- Mortgage in Principle: This can give you an indication of potential borrowing and its cost. You can apply for a Mortgage in Principle.
Smith also points buyers towards the forthcoming Your First Home scheme, which is intended to offer extra support to first-time buyers interested in new-build homes.
See what homes you could afford: try the Your First Home scheme calculator.
Coming to the end of a mortgage deal?
Homeowners whose fixed-rate deals end in the next six months may be weighing a new fix against a tracker. UK Finance data cited in the article puts 510,000 UK homeowners on tracker mortgages and another 470,000 on standard variable rate deals.* For current remortgage rates by loan-to-value band, see Rightmove’s remortgage rates guide.
Some mortgage deals can be reserved months before your current offer expires, but the window depends on the lender and product. And because lenders have been changing deals frequently, a rate you’ve seen today may disappear before you’re ready to act.Fixed or tracker: which suits your circumstances?
A fixed-rate mortgage keeps your interest rate steady for an agreed period, making payments easier to plan. A tracker rate may start at a different level, but it moves with the Base Rate, so your repayments can rise or fall. Matt Smith says the choice comes down to your finances and comfort with uncertainty, not a confident prediction about where rates are headed. As he puts it: > “A mortgage adviser will want to understand someone’s circumstances, their tolerance for uncertainty and how they would cope with changing monthly payments. > > “For a tracker, one thing people can look at is how far above Base Rate the mortgage tracks. You could then see what the interest rate could become if we saw increases of another 0.25 or 0.5 percentage points. > > “Finally, it’s important to remember that interest rates aren’t the only thing that affect the cost of a mortgage. Before switching between products, remember the product fees you’ll pay for moving from one to another.” That last point is easy to overlook. A lower rate may not mean a cheaper mortgage once product fees are included. If you’re weighing up a switch, a broker can help you compare the full costs against your budget and circumstances.
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