November 2025 Mortgage Forecast:
What Homebuyers Should Know
Before Budget Day (26 November 2025)

With the Budget now scheduled for Wednesday 26 November 2025, the key forces shaping mortgage pricing this month are clear: a Bank Rate held at 4.00% (with an MPC decision due on 6 November), stubborn CPI inflation at 3.8% in September, SONIA swap rates drifting lower versus the summer, and selected lenders trimming fixed rates. Together, these set the tone for buyers and remortgagers planning moves before Budget Day.

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What Is Driving UK Mortgage Pricing

Fiscal and monetary calendars matter this month. The Budget will take place on 26 November, alongside the Office for Budget Responsibility’s updated outlook. Markets are watching for any tax or housing-related measures that could influence demand, alongside the Bank of England’s 6 November rate decision.

On the data side, the Bank of England’s September “Money and Credit” release showed house-purchase approvals rising to around 65,900—the highest since December 2024—suggesting steady pipeline activity into year-end. Inflation, however, remains at 3.8% year-on-year for September, limiting how quickly the Bank can ease policy.

Bank of England, Gilt Yields and SONIA Swaps

The Bank Rate stands at 4.00% (cut from 4.25% in August), with the MPC set to meet on 6 November. While some forecasters now pencil in gradual cuts through 2026, the near-term outlook hinges on inflation trends and the fiscal stance later this month.

Funding costs that help price fixed-rate mortgages have eased compared with early autumn. End-October snapshots show 2-year SONIA swaps around 3.49% and 5-year near 3.57%. Five-year gilt yields—a benchmark for longer-dated funding—have hovered near the high-3% area in early November. These levels support the recent, modest reductions in headline fixed rates from some high-street lenders.

Lender Moves and Housing Activity

Selected lenders have nudged prices down. Nationwide announced reductions of up to 0.25 percentage points across two-, three-, five- and ten-year fixes, with the changes effective from 5 November. Trade updates also point to trims from other majors into late October and early November. As ever, product availability and criteria vary, and rates can change quickly.

Approvals momentum has been underpinned by those steadier funding costs. The Bank of England’s latest figures showed net mortgage approvals for house purchase rising in September, while gross lending remained sensitive to affordability checks and household budgets.

What This Could Mean for First-Time Buyers, Remortgagers and Landlords

For first-time buyers, slightly lower fixed-rate quotes may improve monthly affordability versus the summer, but outcomes still hinge on deposit size, income multiples and credit profile. If the Budget tightens personal taxes or property-related reliefs, disposable incomes and investor sentiment could be affected, even if funding costs ease gradually.

For remortgagers, current five-year swap levels suggest scope for competitive pricing where equity is strong, though headline rates can be materially different across LTV bands and fees. Starting conversations early can help lock a rate or explore alternatives if market levels move around the Budget or the December MPC meeting.

For buy-to-let landlords, pricing remains sensitive to rental stress tests and interest coverage ratios. Any Budget changes to property taxation would be relevant for plans, but until measures are confirmed, it is prudent not to base decisions on speculation. The OBR’s Budget-day forecast will also frame expectations for growth, inflation and gilt issuance into 2026.

Key Numbers (indicative snapshots)

• Bank Rate: 4.00% (as of 7 August; next MPC 6 November)

• CPI inflation: 3.8% year-on-year (September 2025)

• SONIA swaps (31 Oct 2025): 2-yr ~3.49%, 5-yr ~3.57%

• 5-yr gilt yield: ~3.90% (4 Nov 2025)

• Nationwide: rate cuts up to 0.25 percentage points effective 5 Nov

As at 5 November 2025, London.

If you’d like to understand what today’s moves could mean for you, speak to a qualified mortgage adviser at Mortgage One. We can explain your options and timings based on your circumstances: www.mortgageonefinance.co.uk

The information provided in this article is for general guidance only and does not constitute personal or regulated financial advice. For tailored advice specific to your circumstances, please contact Mortgage One directly.

Some Buy to Let mortgages are not regulated by the Financial Conduct Authority.

FAQs

1) Will the 26 November Budget change mortgage rates immediately?
Not directly. Mortgage pricing reacts mainly to funding costs (like SONIA swaps and gilt yields) and Bank of England policy. Budget measures can still influence rates indirectly via growth, inflation and gilt issuance expectations.

2) Is the Bank of England likely to cut rates in November or December?
The Bank Rate is 4.00% and the 6 November meeting follows three months of 3.8% CPI inflation; markets expect cuts to be gradual and data-dependent rather than immediate.

3) Why do SONIA swaps matter for fixed mortgages?
Lenders use swap markets to hedge fixed-rate lending. When 2- and 5-year swap rates fall, it often allows some easing in fixed-rate mortgage pricing, subject to competition and risk appetite.

4) Are lenders actually lowering rates now?
Yes, several have tweaked pricing. For example, Nationwide announced cuts of up to 0.25 percentage points effective 5 November, with other banks adjusting ranges through late October. Availability and criteria vary.

5) What’s happening to mortgage approvals?
House-purchase approvals rose to about 65,900 in September, the highest since December 2024, signalling steady activity into year-end.