November 2024: A Good Time
to Fix Your Mortgage Rate?

Is Now the Right Time to Fix Your Mortgage Rate? Key Insights as We Approach 2025

Introduction

As 2025 nears, UK homeowners face an important question: is now the right time to secure a fixed mortgage rate? With inflation easing and mortgage rates showing signs of stability, many borrowers are weighing their options. This guide outlines the current trends and economic considerations influencing mortgage decisions and why now could be a strategic time to lock in a rate.

1. Recent Mortgage Market Trends

The mortgage market in 2024 has seen significant fluctuations. Rates increased at the end of 2023 but stabilised mid-2024 as inflation eased and the Bank of England adopted a more cautious stance on rate changes.

• Inflation Cooling: Slower inflation has improved lender confidence, resulting in more competitive mortgage offerings.

• Monetary Policy Outlook: While base rate reductions may occur in the longer term, significant cuts are not expected in the near future. This has made current fixed-rate deals more appealing as a hedge against uncertainty.

2. The Appeal of Fixed Rates

Fixed-rate mortgages offer certainty in uncertain times. They protect against unexpected rate rises and allow homeowners to plan their finances with greater confidence.

• Budgeting Confidence: Fixed monthly payments offer stability over the term of the mortgage.

• Product Range: Borrowers can choose from a wide range of fixed terms, from short to long durations, to suit individual financial goals.

3. Inflation and Its Impact on Mortgage Strategy

Easing inflation helps create a favourable environment for fixed-rate mortgages. As inflation slows, the risk of further rate hikes diminishes, allowing borrowers to lock in predictable payments.

• Stability in Lending Conditions: Lower inflation supports steadier fixed-rate offers.

• Timely Opportunity: With current economic indicators pointing to a stable environment, locking in now could prove beneficial in the long term.

4. Economic Outlook for 2025

While the broader UK economy is improving gradually, the timing of future rate cuts remains uncertain. Experts suggest that major rate reductions may not materialise until later in 2025.

• Potential Risks: Waiting for further rate cuts may expose borrowers to market volatility or future rate rises.

• Strategic Fixing: Fixing now could provide long-term security, particularly for those nearing the end of their current mortgage term.

5. Specialist Fixed-Rate Options

For borrowers with specific needs, a variety of specialist fixed-rate products are available:

• Self-Employed Borrowers: Options are available for those with variable incomes, offering financial consistency.

• Buy-to-Let Mortgages: Fixed rates can protect landlords from income fluctuations and rising costs.

• Adverse Credit Products: Fixed-rate mortgages offer a predictable path to financial recovery for those with previous credit issues.

• Interest-Only Products: These offer predictability for borrowers with a clear repayment strategy.

6. Securing a Fixed Rate: Steps to Take

To find the most suitable fixed-rate deal, timing and advice are essential:

• Compare Across the Market: Fixed rates vary between lenders. Reviewing a wide range of products can help identify the most competitive options.

• Monitor Trends: Rates can change quickly. Staying informed helps with timing a rate lock.

• Consult an Expert: A mortgage adviser can help match your financial profile with the most suitable fixed-rate product, and identify exclusive deals not publicly advertised.

Conclusion: Fixing Now May Offer Financial Stability

With mortgage rates steadying and inflation easing, now may be a suitable time for many UK homeowners to consider fixing their mortgage rate. The current environment of moderate inflation and cautious optimism presents an opportunity for borrowers to secure stability and protect against future rate movements.

Speak to Mortgage One today for professional guidance and support in reviewing your fixed-rate mortgage options.