A rate rise is back on the table. What it means for sellers

What has happened to rates since early September?

On 3 September 2026, Huw Pill, the Bank of England's chief economist, told an audience at the Edinburgh Chamber of Commerce that raising Bank Rate now would reduce the risk of having to act harder later. He said a rise “need not be the start of a prolonged and aggressive series of increases”, and argued that moving early would head off inflation becoming embedded.

Bank Rate is the interest rate the Bank of England pays commercial banks, and it sets the floor for what those banks charge borrowers. It was held at 3.75% on 30 July 2026 and held again on 17 September 2026, both times with three of the nine committee members voting to raise it to 4%.

Lenders did not wait for the Bank. Moneyfacts reported on 11 September that two-year swap rates rose from 4.33% to about 4.6% after 4 September, and five-year swaps from 4.43% to about 4.7%. Of 28 lenders that changed products that week, 20 raised rates or made mixed changes and three made net cuts.

A second wave followed. Moneyfacts reported on 15 September that NatWest, Santander, HSBC, Lloyds and TSB had raised rates for the second time this month, taking the average two-year fix to 5.73% and the five-year to 5.78%, with swap rates above 4.70%.

What did the Bank decide on 17 September?

It held Bank Rate at 3.75% by six votes to three. Megan Greene, Catherine Mann and Huw Pill voted for a rise to 4%. The Committee said the longer energy prices stay high, the greater the risk of more persistent inflation, and that it stands ready to act.

Inflation is the reason. The Office for National Statistics reported on 16 September that CPI inflation rose to 3.1% in August from 2.9% in July, driven by motor fuel. Bank staff expect it to reach around 3.75% by the end of 2026 and slightly above 4% early in 2027.

The next decision is on 5 November 2026. Reports after the announcement said markets see a rise at the November or December meeting as more likely than not. Nothing is certain, but the direction of travel for the next few months points up, not down.

What would a rate rise do to my buyer's budget?

A fixed-rate mortgage is a loan where the interest rate is locked for a set period, usually two or five years. Lenders price those fixes off swap rates, what money costs them in the wholesale market, which is why fixed rates have risen this month even though Bank Rate has not moved.

The number that decides whether your buyer can still afford your house is not the headline rate. It is what a given monthly payment will borrow. The table below is a ValuQ calculation on a £220,000 repayment mortgage over 25 years, starting from the average two-year fixed rate of 5.73% recorded on 15 September 2026.

A further quarter point costs that buyer about £34 a month and takes roughly £5,200 off what they can borrow on the same budget. Half a point takes off about £10,200. On a home priced near a round number, that is the difference between an offer at your asking price and an offer just under it.

A rate move does not change your house. It changes the size of the mortgage the person standing in your hallway can get.

What should I do if I am selling right now?

1. Do nothing dramatic. Rising fixed rates are a reason to check your buyer's position, not a reason to reprice your home on a maybe.
2. If you have an agreed sale, ask your agent to confirm the buyer's full mortgage application is submitted rather than sitting at decision in principle. Once the lender issues a formal offer, the rate inside it is locked.
3. If your buyer is stalling and blaming rates, put the arithmetic in front of them. Waiting has a cost now, and it may not have a payoff.
4. If you are yet to list, price to the market as it is today rather than to the market you hoped for in the spring. Homes that are priced right still sell in a quiet market.
5. Keep your own borrowing in view. If you are buying onward and your own fix ends soon, talk to a broker about how long an offer can be held.

What if I am waiting for rates to fall before I sell?

Waiting is a position, and it has a price. Rightmove analysis published on 31 July 2026 put the average time from listing to completion in Great Britain at 216 days, made up of 62 days to find a buyer and 154 days from agreeing the sale to getting the keys handed over. A seller who waits for a rate cut that markets are not currently expecting is delaying by most of a year, on current timings.

The market you would be waiting out is not falling. Nationwide reported house prices up 0.2% in August and up 1.6% over the year, with the average home at £275,465. That is a slow market, not a sliding one.

Common questions about a rate rise and your sale

ValuQ gives UK homeowners free, side-by-side property valuations from competing local estate agents. When the rate story changes every fortnight, the useful thing is not a forecast. It is several local agents telling you what your home will actually sell for in this market, on one screen, before you speak to any of them.