Bank of England base rate hold leaves borrowers facing mortgage uncertainty

What happened

The Bank of England base rate remained at 3.75% following its decision on 17 September 2026, according to Rightmove. For borrowers, the distinction is between the rate set by the Bank and the price lenders charge for a mortgage. Rightmove’s mortgage expert, Matt Smith, said the hold offered some stability but did not rule out further changes to the deals available to buyers and homeowners.

Rightmove reported that the base rate had been unchanged since December 2025, when the Bank reduced it by 0.25 percentage points. September’s decision therefore continued that pause rather than introducing a new reduction in borrowing costs. A hold does not itself lower the interest due on a mortgage that tracks the base rate.

Average rates for both two-year and five-year fixed mortgages stood at approximately 5.39% on 17 September, according to Podium data published by Rightmove. These are dated market averages, not October quotations or rates available to every applicant. Rightmove said the rate and repayment offered to an individual borrower would depend on their circumstances and the lender’s criteria.

For two-year fixes, Rightmove compared that September average with 4.25% before the war in Iran and around 5.43% during heightened tensions in April. Its figures showed that average pricing remained above the earlier level despite easing slightly from April. The comparison concerns two-year products; the report did not provide the same historical figures for five-year fixes.

The background

Rightmove explained that the Bank sets interest rates while seeking to keep inflation close to its 2% target and support the wider economy. The inflation figure cited in its September report was 3.1%, meaning average prices for goods and services were that much higher than a year earlier. That figure describes the rate of price increases, rather than a fall in prices or a measure of mortgage costs.

For a borrower already on a fixed-rate mortgage, a base-rate decision does not change the agreed interest rate during the fixed period. Rightmove said payments would remain unchanged until the deal ended. The practical issue for those households is therefore the cost of their next arrangement, rather than an immediate change caused by the September announcement.

Tracker mortgages generally follow the base rate using the terms set out in the mortgage agreement. A hold therefore produces no base-rate-driven change in their interest charge. Other variable mortgages are different: a lender’s standard variable rate is not necessarily tied directly to the Bank’s rate, so borrowers should not treat an unchanged base rate as a guarantee that every variable mortgage payment will stay fixed.

Fixed-rate offers are also distinct from mortgages that directly track the Bank’s decisions. Smith said their pricing reflected market expectations before a rate announcement, as well as the cost of funding the loans. That helps explain why buyers can encounter different mortgage quotes even while the base rate is unchanged, an issue relevant to the wider picture of family-home affordability and mortgage costs.

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What people are saying

Smith identified tracker borrowers as a group likely to welcome the September decision because their repayments move with the base rate. His assessment was narrower for people planning a purchase: an unchanged rate did not remove the uncertainty surrounding their borrowing costs. The immediate effect on an existing loan and the prospects for a new mortgage were therefore separate questions in his analysis.

On lenders’ pricing, Smith pointed to recent increases in the underlying cost of funding fixed-rate products. He said lenders would continue adjusting mortgage rates despite the Bank’s hold. For applicants comparing products, that makes the availability of a particular deal important alongside its advertised price; the issue is explored in Property Pulse UK’s reporting on the shorter window for comparing mortgage deals.

Smith also said financial markets were allowing for possible further base-rate rises in the months ahead. He cautioned against interpreting the September decision as evidence that mortgage rates had reached their highest point. That was an assessment of market expectations at the time of Rightmove’s report, not an announcement from the Bank or a guarantee that any particular increase would follow.

For home-movers, Smith emphasised working out a comfortable repayment level and monitoring the products available. His position put household affordability ahead of trying to predict the next rate decision. Buyers weighing that budget against their existing housing costs can also read the separate reporting on first-time buyer mortgage payments compared with rent, rather than assuming that buying will necessarily reduce monthly outgoings.

What happens next

Rightmove listed the next Bank of England interest-rate announcement for midday on 5 November 2026. It said the Monetary Policy Committee meets approximately every six weeks to consider whether rates should rise, fall or remain unchanged. Its report also stressed that changes in the broader economy could alter market expectations, so the September outlook should not be read as a settled forecast for November.

For homeowners nearing the end of a fix, Rightmove suggested reviewing the options several months before expiry. It highlighted the Mortgage Charter, launched in July 2023, under which participating lenders may allow eligible borrowers to secure a replacement deal up to six months before their current rate ends. Access depends on the lender and the borrower’s circumstances; the option is not an automatic entitlement for every mortgage customer.

Moving the mortgage to another lender usually requires a full application, according to Rightmove. It said that could involve affordability and income checks, legal work and a property valuation, with timescales varying between lenders and cases. A borrower’s existing mortgage approval does not remove those steps, so the end date of the current deal matters when planning a switch.

Rightmove warned that borrowers who do not arrange a replacement may move onto their lender’s standard variable rate, potentially increasing repayments. It also said product fees and any early repayment charges should form part of the comparison between options. The lowest advertised interest rate is therefore not, by itself, enough to establish which arrangement has the lowest overall cost for a particular household.

Mortgage calculators can help estimate borrowing and repayments, but Rightmove said their results were neither recommendations nor guarantees of eligibility. It also distinguished a mortgage in principle from a mortgage offer: further affordability, credit and property checks still apply. Rightmove advised seeking guidance from a regulated mortgage adviser and warned that a home may be repossessed if mortgage repayments are not maintained.

Why this matters

For buyers and homeowners approaching renewal, September’s hold was not a promise of cheaper borrowing. Rightmove’s analysis separates the immediate effect on an existing mortgage from the price of a replacement deal, which also reflects funding costs and market expectations. The practical priority is to check the current deal’s end date, compare repayments and fees, and allow time for any application. The September averages provide context, but they cannot establish what a particular borrower will be offered.