UK Mortgage Rates 2025: Will House Prices Finally Fall?

Updated August 2025 | By PoundPath.com Financial Insights Team

Mortgage Rate Trends in 2025

Bank of England base rate: 4.0% (August 2025, down from 5.25% in 2023)
2-year fixed (60% LTV): ~3.90%
5-year fixed (60% LTV): ~4.02%
Standard Variable Rate (SVR): ~7.60%

Mortgage Product	Best Rate	Average Rate	Notes
2-year Fixed (60% LTV)	3.73%	3.90%	Best: Santander
5-year Fixed (60% LTV)	3.86%	4.02%	Best: HSBC
SVR	7.60%	7.60%	Avoid if possible

Major lenders have cut fixed rates in line with BoE reductions.
Fixed rates are generally lower than tracker/variable rates.

House Price Predictions: Will They Finally Fall?

Most experts predict prices will rise 2-4% in 2025.
19/21 mortgage experts expect growth, not a fall.
Ongoing housing shortage and robust employment underpin the market.
Risks remain, but a major crash is not widely forecast.

Chart Placeholder: UK House Price Index 2020-2025

Why Are Mortgage Rates Changing?

Key factors:

BoE base rate policy
Inflation (CPI ~3.6% as of June 2025)
Global economic events
Lender competition

Date	BoE Base Rate	Mortgage Rate Trend
Jan 2021	0.1%	Ultra-low
Aug 2023	5.25%	Peak, affordability crisis
Aug 2024	5.0%	First cut, rates ease
Aug 2025	4.0%	Fixed deals below 4%

What Does This Mean for Homeowners and Buyers?

Remortgaging: Lock in a new deal now; avoid SVR.
First-time buyers: More affordable than 2023; big deposits help.
Trackers/variable: Could benefit if BoE cuts again, but future is uncertain.

Mortgage Size	At 6.85% (2023)	At 4.52% (2025)	Monthly Saving
£100,000	£655	£510	£145
£200,000	£1,311	£1,015	£296
£300,000	£1,966	£1,523	£443

Expert Opinions & Survey Insights

18/21 experts think rates could fall further in 2025.
19/21 predict house prices will rise, not fall.
Some caution due to global risks, but overall optimism for the market.

How to Secure the Best Mortgage in 2025

Act early: Start the process up to 6 months ahead.
Compare deals: Use comparison sites and fee-free brokers.
Monitor rates: Lock in but check for better offers before completion.
Boost credit score: For best eligibility and rates.
Bigger deposit: 20%+ unlocks lowest rates.

Applicant Checklist:

Know your deal’s end date
Gather ID, payslips, statements
Check your credit report
Calculate budget and borrowing
Contact brokers for advice

Interactive Mortgage Calculators & Tools

Monthly Repayment Calculator
Remortgage Savings Calculator
Deposit Growth Tool

Placeholder: Embed your branded calculators or link to trusted tools.

House Price and Mortgage Rate Timeline (2020-2025)

Year	Mortgage Rate News	House Price Trend
2020	Record lows	Prices rise post-lockdown
2021	Rates up	Growth slows
2022	Rates jump, inflation	Prices stagnate/dip regionally
2023	Peak rates, crisis	Growth slows, regional gaps
2024	Rates cut, stabilisation	Prices up 2–3%
2025	Further cuts, sub-4% deals	Modest growth

Timeline infographic placeholder: Add your visual here.

FAQs

Q: Are mortgage rates going down in 2025?
A: Yes, fixed rates have dropped below 4% for the first time in years.

Q: Will house prices fall in 2025?
A: Experts expect modest rises, not falls, in 2025.

Q: Should I wait to remortgage or buy?
A: Waiting is risky; lock in a deal now.

Q: What is the BoE base rate?
A: 4.0% as of August 2025.

Q: How does inflation affect rates?
A: High inflation could slow further cuts, but rates are easing for now.

References & Sources

HomeOwners Alliance: Mortgage Rate Predictions 2025
BBC: What are interest rates and will they fall further?
Online Mortgage Advisor: 2025 Mortgage Predictions

Disclaimer: This article is for informational purposes only and does not constitute financial advice. Always consult a qualified adviser before making mortgage or property decisions.