Mortgage Rate Predictions 2025: Will they go down further? Here's your Guide to Securing the Best Deal this year!

What are rates going to do for the remainder of 2025?

Current Market Overview

The mortgage market in May 2025 presents both opportunities and challenges for borrowers. Following the Bank of England's recent cut from 4.5% to 4.25%, many lenders initially reduced their rates. However, higher-than-expected inflation figures for April have caused some lenders, including Halifax, Nationwide, and Santander, to reverse course and increase rates.

Currently, the average 2-year fixed rate sits at 4.61%, while 5-year fixes average 4.58% - significantly higher than the ultra-low rates of 2020-2021, but more competitive than the peaks we saw in 2023.

What's Driving Rate Changes?

Several factors are influencing mortgage rates in 2025:

• Bank of England Policy: Markets are pricing in just one additional quarter-point cut in 2025, taking base rates to 4%

• Inflation Concerns: April's higher-than-expected inflation has made the Bank of England more cautious about further cuts

• Global Economic Factors: Trade policy changes and geopolitical tensions continue to impact market confidence

• Lender Competition: Some building societies and smaller lenders are still offering competitive rates to attract business

Expert Predictions for 2025

Industry experts suggest that while rates may continue to fall gradually, the pace will be slower than initially anticipated. The Office for Budget Responsibility forecasts that average mortgage rates across all properties will peak at 4.7% by 2028, remaining there until 2030.

This means borrowers coming off cheap fixed-rate deals from 2020-2021 will face significantly higher payments, with some seeing increases of £200-400 per month.

Should You Act Now or Wait?

The consensus among experts is clear: don't wait. Here's why:

• Rate Volatility: The best rates available today could disappear quickly

• SVR Risk: Delaying action could mean rolling onto your lender's expensive Standard Variable Rate (averaging 7.60%)

• Market Uncertainty: With multiple economic factors at play, predicting future rate movements is increasingly difficult

How Mortgage Tree Can Help You Navigate 2025's Market

At Mortgage Tree, we understand that every client's situation is unique. Whether you're 20 or 65, we provide tailored mortgage solutions across all life stages and property goals.

Our Services Include:

First-Time Buyers: We'll help you understand how much you can borrow, find the best rates for your deposit size, and guide you through the entire process. With deposit requirements varying significantly between lenders, our expertise ensures you access the most competitive deals.

Home Movers: Moving home in 2025's market requires careful timing and planning. We'll help you coordinate your purchase and sale while securing the best possible rate for your new property.

Remortgaging: If your current deal is ending in the next six months, we'll find you the best remortgage rates available and help you avoid expensive SVR charges. Our clients typically save hundreds of pounds monthly by switching at the right time.

Buy-to-Let Investors: The BTL market has its own complexities, with different lending criteria and rate structures. We'll match you with specialist lenders who understand investment property financing.

Special Offers for Our Community

• NHS Staff: We provide completely free mortgage services to all NHS employees - our way of supporting those who support our communities

• York Residents: Special discounted rates for all clients based in York, because we believe in supporting our local community

Why Choose Mortgage Tree?

Market Knowledge: We monitor rate changes daily and have relationships with lenders across the market, ensuring you get the best deal available for your circumstances.

No Surprises: We'll clearly explain all costs upfront, including any arrangement fees, and help you calculate the true cost of each mortgage option.

Ongoing Support: Unlike some brokers who disappear after completion, we provide ongoing rate reviews to ensure you're always on the most competitive deal.

Speed and Efficiency: In volatile markets, timing matters. We can often secure rate reservations quickly, protecting you from rate increases while your application progresses.

Take Action Today

With mortgage rates showing signs of stabilizing but remaining unpredictable, the best strategy is to secure expert advice now. Whether you're buying your first home, moving up the property ladder, remortgaging, or building an investment portfolio, Mortgage Tree can help you navigate 2025's complex mortgage market.

Don't let uncertainty cost you thousands of pounds. Contact us today to discuss your mortgage needs and secure the best possible deal for your circumstances.

Get in touch:

• Email: jason@mortgage-tree.co.uk

  Phone: 07773064911

  Let Mortgage Tree help you find the right mortgage solution in 2025's challenging market. Your financial future is too important to leave to chance.