Planning to buy or remortgage a property in the near future? If so, it’s likely you’ve been keeping a close eye on interest rates and mortgage rates to see if playing a waiting game might work for you.
Since August last year, when the Monetary Policy Committee began cutting the base rate, 1.25 percentage points have been shaved off the previous 5.25% rate. Now at 4%, with the hope of at least one more cut this year, mortgage rates have been following a similar downward trajectory. It might be tempting to see how much further they fall before you commit to a new mortgage, but waiting for better rates comes with risks that could cost you your dream property.
Risk 1 – Further rate cuts aren’t guaranteed
The MPC is following a slow and steady approach to interest rate cuts and must balance its rate cutting alongside other factors. With outside influences, such as geopolitical tensions, also impacting economic triggers then further rate cuts simply aren’t guaranteed. Lenders will also be looking at market predictions and, if things are looking bleak, will put a halt to their mortgage rate cuts, too. And, although the base rate has fallen over the last year, mortgage rates haven’t necessarily followed at the same pace.
Risk 2 – House price rises
According to figures from the ONS, published in July, the average price of a property in the UK in May 2025 was £269,000 – up 3.9% on the same time last year and 1.1% on the previous month. Buyers waiting for rate cuts need to consider how quickly prices are rising in their area to balance whether potential price increases are likely to outweigh the savings achieved by waiting for possible lower rates.
Risk 3 – Increased competition
You won’t be the only one playing the waiting game when it comes to mortgage rates. Many buyers and sellers will also be considering waiting longer. The unknown factor is the tipping point that will prompt a rush to market. At that point, the additional buyers could push prices up further. The extra competition could also mean the property of your dreams goes to someone better placed to move than you.
Risk 4 Missing the house of your dreams
In our previous point, we highlighted the threat of extra competition coming into play if you wait around for lower rates, but you could also miss out on your dream property simply because it’s already on the market and you weren’t ready to look.
Risk 5 Waiting for something that won’t happen soon
Many buyers or mortgage holders were able to secure fixed-rate mortgages of around 1-2% five years ago. If you are one of those currently needing to remortgage, then you may be holding out for the market to drop to similar rates in 2025. The trouble is that isn’t going to happen either now or in the imminent future, so be realistic about what rate you are hoping for to ensure you don’t miss out.
Deciding when to buy or remortgage and the right time to lock in on fixed rates should be based on your personal circumstances and needs and should always be guided by professional mortgage advice. If the time is right now, or you need advice, we’re here to help.