Mortgage Rates Hit Six Percent as UK Property Crisis Deepens

Britain's property crisis is deepening as mortgage rates are expected to 'stay higher for longer', according to analysts at Moneyfactscompare. The warning comes ahead of a major announcement from the Bank of England today, which will confirm any changes to the UK's base rate. This rate determines the cost of borrowing and impacts mortgage deals.

The average five-year fixed rate for borrowers putting down just 5% has now broken through the six per cent barrier, reaching 6.07% at 95% loan-to-value (LTV). The Moneyfacts Average New Mortgage Rate currently sits at 5.59%, having risen from 5.47% at the beginning of July.

Experts warn that any future increases to the Bank of England Base Rate would tighten conditions further, making it even harder for first-time property buyers and those looking to remortgage. Rachel Springall, a finance expert at Moneyfactscompare.co.uk, noted that 'interest rates are expected to stay higher for longer' and that those who delay locking into a fixed rate mortgage could pay the price.