Mortgage rates are climbing again, and this time the Bank of England’s own decision to sit still is part of the story. Despite holding the base rate at 3.75 per cent on 17 September for the sixth consecutive time since December 2025, lenders across the market have been repricing their fixed-rate deals upward, some of them more than once this month alone. For anyone in Norfolk or Suffolk hoping the plateau in rates would hold long enough to make a move, the timing could hardly be less welcome.
In September 2026, the recent improvement in mortgage rates has started to unwind, with many lenders increasing fixed rates, and experts warn further increases may follow. The Monetary Policy Committee’s decision itself was not unanimous. The Bank of England held interest rates at 3.75% on 17 September, with six members voting to hold and three members voting to increase rates to 4%. That split matters, because it signals a committee increasingly nervous about where inflation is heading next.
The inflation backdrop explains the caution. Inflation rose to 3.1% in August, comfortably above the Bank’s 2 per cent target, and policymakers are not confident the trend has peaked. The Bank warned that interest rates may need to rise if the conflict in the Middle East continues and higher energy prices lead to more persistent inflation, with Governor Andrew Bailey saying the longer the conflict continues, the more likely it is that the Bank will need to raise rates to bring inflation back to its 2% target. Markets have taken note. As one report on This is Money put it, higher oil prices, renewed inflation worries and a global bonds sell-off have rattled financial markets, and investors are now betting that rates could climb toward 4.75 or even 5 per cent within the next year, rather than fall further.
The mechanics here trip up a lot of buyers. Fixed mortgage pricing is not set directly by the base rate; it tracks swap rates, the wholesale cost at which lenders secure funding for two or five years ahead. Those swaps have moved sharply. Moneyfacts reported that the two-year swap rose from 3.33% in late February 2026 to 4.26% on 3 September, and above 4.70% by 15 September. Lenders including HSBC, Barclays, NatWest, Santander, Lloyds Bank and TSB have all repriced deals higher in response over the past few weeks.
The effect on actual mortgage costs has been substantial. Since the start of March 2026, the average two-year fixed mortgage rate has risen from 4.84% to 5.73%, and on a £250,000 mortgage over 25 years, that adds around £131 to monthly repayments, or £1,572 a year. Looked at from the borrowing-power side rather than the repayment side, the squeeze is even starker: a buyer able to afford roughly £1,438 a month could have borrowed about £250,000 back in March, but the same monthly budget now stretches to only around £229,000, a gap of roughly £21,000 in what someone can actually bid for a property.
Brokers are urging caution against reading too much into the hold itself. Nicholas Mendes of John Charcol has said the decision to keep rates unchanged does not take a future rise off the table, and that the next few inflation and wage readings will be decisive in whether the case for a rise later this year strengthens. Ian Futcher, a financial planner at Quilter, has made a similar point to borrowers directly: a hold today should not be mistaken for an assumption that cheaper borrowing is coming tomorrow.
Locally, the numbers already point to a market that has little slack to give. Across the 31 areas we track, the average asking price sits at £673,314, a figure that reflects the higher-value character of much of this patch, from coastal villages to substantial period homes inland. Annual price growth has been flat at 0.0 per cent, which tells its own story: sellers are not commanding premiums, but nor are prices sliding to compensate for costlier borrowing. The market has simply stalled.
That stall shows up starkly in how long homes are taking to sell. The average time on market across these areas stands at 269 days, the best part of nine months, and the average sold-subject-to-contract rate is just 22 per cent. In plain terms, roughly one in five listed homes has actually found a buyer at any given moment, while the rest sit and wait. Higher borrowing costs will not help that arithmetic. When a £131 monthly increase on a £250,000 loan is scaled up to the price points typical of this region, the affordability gap widens considerably, and buyers already cautious after a run of repricing announcements have even more reason to pause and reassess their budgets before committing.
For sellers, the practical consequence is that pricing has to work harder to compensate for the mood among buyers. A property that might once have generated competing offers within weeks can now sit through several rounds of viewings before an offer materialises, and vendors who priced ambitiously earlier in the year may need to revisit those figures if a five-month or longer wait is not something they can absorb. For anyone whose current fixed deal is due to expire in the coming months, the maths has shifted meaningfully since spring, and getting a remortgage application in early, before any further repricing, is now sound practical advice rather than mere caution.
The next scheduled base rate decision falls on 5 November, and it is being watched closely by brokers and lenders alike as the point at which the Committee will have a fuller picture of how inflation and wages are trending through the autumn. Market pricing already implies a real possibility of the base rate moving higher over the coming year rather than lower, a reversal of the assumption that dominated thinking for much of the past two years.
None of this points to a market in freefall. Norfolk and Suffolk’s flat annual pricing and stretched selling times reflect a period of adjustment rather than collapse, a market recalibrating to a world where cheap fixed-rate borrowing can no longer be taken for granted. Whether that recalibration eases or deepens will depend less on what the Bank of England does with its headline rate than on what happens to inflation, energy costs and the swap markets in the weeks ahead. For buyers and sellers across the region, the practical lesson is the same one brokers keep repeating: a hold is not a promise, and the cost of waiting has just gone up.
