What is happening to mortgage rates?

Thursday 29 February, 2024

On Friday (23/02/2024), a news article posted to the BBC website(1) stated that several mortgage providers were poised to raise their rates on new fixed-rate deals. This marked a continuation of a spate of adjustments that had occurred since the beginning of the year.

In January, there was a notable decrease in rates by lenders, providing some relief to the 1.6 million individuals planning to remortgage in 2024. However, due to increased costs associated with mortgage lending, many providers are once again raising their mortgage rates.

Which banks have raised mortgage interest rates?

HSBC, NatWest, and Virgin Money were among those increasing the costs of their new deals1. This is in addition to other banks such as Santander, Coventry Building Society, and TSB, all raising their mortgage rates on their new fixed-rate deals earlier that week.

As a result of these changes, the availability of widely accessible five-year fixed mortgage deals with rates below 4% has diminished. Overall, the average rate on all new fixed mortgage deals has been gradually increasing as lenders adjust their pricing strategies.

The expenses incurred by banks when borrowing from wholesale markets have been steadily rising in recent weeks, driven by worsening economic markers and continually higher inflation figures. This trend raises the possibility that both interest rates and, consequently, mortgage rates will remain higher for an extended period.

Are all banks raising mortgage interest rates?

There are, however, some indications that suggest lenders are struggling to reach a consensus on appropriate rate levels. For example, Halifax, a member of the Lloyds Banking Group, is set to reduce interest rates on certain mortgage deals.

This suggests that there could be competition for position within the mortgage market as the overall market remains extremely competitive. However, it is possible that in the short term, we may still see more movement in mortgage rates.

Example of mortgage rate increase (2) (as at 23/02/2024)


A two-year fixed-rate remortgage now starts from 4.69% with a £1,495 fee (60% LTV), up from 4.59%. The equivalent five-year deal has gone up by the same amount to a new rate of 4.3%.

Katherine Mumford, Mortgage Broker in Tottenham, North London said:

“We can see that with some banks raising their mortgage rates, it could be a cause of concern for homeowners with mortgage deals coming to the end of their term. However, in such a shifting market, the increases are not currently universal. This means that with the access Thomas Oliver has to non-retail market lenders, we have access to a much wider range of mortgage deal options.”

Katherine continued: “With such changes occurring, often without much notice, we strongly recommend that people speak with our professional mortgage advisers as soon as possible to determine which is the most fitting mortgage deal for their own financial position.”

If you are now looking to review your mortgage options, given these changing times, then Thomas Oliver Mortgage Advisers are here for consultation. Simply call 01707 872000 to speak with a financial professional to help make a more informed decision regarding your mortgage.


Your home may be repossessed if you do not keep up repayments on your mortgage.

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