Are mortgage rates going up or down?
What is pushing UK mortgage rates today, and the early signs of mortgage rates going down or up, read every weekday by Theo from swap rates, lender pricing and the Bank of England.
Quick answer
Nobody can promise which way mortgage rates will go next, but you can see which way the forces behind them are pushing. Fixed rates are priced from swap rates, and lenders usually follow a move in swaps within days or weeks. When swap rates and lender pricing rise together, fixed rates tend to rise. When they fall together, cuts tend to follow.
The first sign of mortgage rates going down is usually swap rates falling, with lenders following within days or weeks. Theo, the UK mortgage tracking app, reads ten of these signals every weekday. The live reading below shows where they point today. It is a reading, not a forecast.
Updated today
Rate pressure today
Reading today’s signals
Six levels, from Easing fast to Severe. Theo lights the gauge up to today’s level.
- Easing fast
- Easing
- Steady
- Building
- High
- Severe
The ten rate signals
- Loading signals
- Lenders repricingRises and cuts across lenders
- 5 year swap ratePrices 5 year fixes
- 2 year swap ratePrices 2 year fixes
- Gilt yieldsGovernment borrowing costs
- Bank Rate expectationsSwaps against Bank Rate
- Bank of England votesHow the Committee split
- World eventsConfirmed market shocks
- InflationThe latest CPI change
- Energy pricesWholesale energy moves
- Lender catch upLenders against swap moves
Theo’s read
Loading today’s read.
Every weekday Theo writes a plain English read of what moved in the market and what it has usually meant for fixed rates.
Watch them turn
Theo alerts you when the signals point to mortgage rates going down.
Where fixed rates could head
Ranges from today’s signals.
Theo turns today’s signals into a range for 2 and 5 year fixes at 30, 60 and 90 days, with today’s average marked on each. The ranges update as the signals change.
One scenario, not a forecast. The line marks today’s average.
Today’s average 2 year fix
The figure to watch for mortgage rates going down, across the lenders Theo checks every weekday morning.
Why fixed rates move before Bank Rate does
Most UK homeowners are on fixed rates, and fixed rates are not set by the Bank of England. Lenders price them from swap rates: the cost of fixing their own funding for two or five years. Swap rates reflect where markets expect Bank Rate to be over that time, so they move on expectations, not announcements.
That is why you can see fixed mortgage rates going down weeks before a Bank Rate cut, and why they can rise even after a cut if markets start expecting fewer cuts ahead. Tracker mortgages and standard variable rates work differently: they follow Bank Rate directly, so they change when the Bank of England decides.
The official figure is published on the Bank of England’s Bank Rate page. So the useful question is not “will the Bank of England cut?” but “what are swap rates and lenders doing right now?” That is what Theo watches. For the causes behind a rise, see why mortgage rates rise.
The ten signals that show mortgage rates going down or up
| Signal | What it measures | What it usually means for fixed rates |
|---|---|---|
| Lenders repricing | How many lenders raised or cut fixed rates recently | The most direct sign. A wave of rises or cuts usually spreads across the market. |
| 5 year swap rate | The market cost of fixing money for five years | The main input for 5 year fixes. A lasting rise tends to push them up. |
| 2 year swap rate | The same for two years | The main input for 2 year fixes. |
| Gilt yields | What the government pays to borrow | Usually moves with swaps. A sharp rise often means pressure ahead. |
| Bank Rate expectations | Where 2 year swaps sit against Bank Rate | A wide gap suggests markets expect rates to stay higher for longer. |
| Bank of England votes | How the Monetary Policy Committee split at its last decision | More votes to hold or raise suggests fewer cuts ahead. |
| World events | Confirmed events that move markets, checked by Theo before they count | Shocks can move swap rates within hours. |
| Inflation | The latest change in CPI inflation | Higher inflation makes cuts less likely. |
| Energy prices | Moves in wholesale energy prices | Feed into future inflation. |
| Lender catch up | Whether lender pricing has caught up with swap moves | If swaps have moved and lenders have not, repricing may still be to come. |
How Theo turns signals into a reading
Each signal is rated by how strongly it is moving: easing, steady, building or strong. Some signals count for more than others, and the combined score places the gauge on one of six levels, from Easing fast to Severe.
A line such as “10 of 10 signals point to higher fixed rates” tells you how many signals agree. Ten pointing lower would be strong evidence of mortgage rates going down, but it is still not the chance that rates will move. The ranges under “Where fixed rates could head” are one scenario built from the same signals, so treat them as a guide to direction, not a prediction of the rate you will be offered.
What a move could mean for your payment
On a typical mortgage, each half a percentage point adds or saves roughly £56 to £61 a month for every £200,000 borrowed over 25 years.
| Interest rate | Monthly payment |
|---|---|
| 4.00% | £1,056 |
| 4.50% | £1,112 |
| 5.00% | £1,169 |
| 5.50% | £1,228 |
| 6.00% | £1,289 |
If your fixed rate ends in the next year
- Your end date and early repayment charge. Leaving before your deal ends usually costs a fee, so the date matters as much as the rate.
- You can usually lock in early. Many lenders let you secure a new rate up to six months before your current deal ends. If rates then fall before it starts, it may be possible to move to a lower one.
- Staying and moving both count. Compare a new deal with your current lender against moving to another, including fees.
- Watch the signals, not the headlines. Headlines report mortgage rates going down only after lenders have cut. Swap rates and repricing show the moves coming.
Theo counts down to your fixed rate deadline, checks whether you are overpaying against today’s rates, and helps you weigh up a 2 or 5 year fix.
Common questions
Are mortgage rates going down?
Will mortgage rates go down soon?
Why do fixed rates change before Bank Rate does?
Should I wait for rates to fall before I remortgage?
How often does Theo update its reading?
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Theo App Ltd is not authorised by the Financial Conduct Authority and does not give mortgage advice. This page is information only and is not a recommendation. Figures marked illustrative are examples, not offers. Speak to an FCA-authorised mortgage adviser about your own circumstances.
Your home may be repossessed if you do not keep up repayments on your mortgage.