Borrowers say goodbye to sub-1% tracker rates | will never contact you by phone to sell you any financial product. Any calls like this are not from Moneyfacts. Emails sent by will always be from Be Scamsmart.

MONEYFACTS ARCHIVE. This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Published: 13/11/2017

Mortgage providers have reacted quickly to the Bank of England's base rate announcement on 2 November, with the majority having already increased their variable tracker mortgage rates. In fact, our latest research shows that not only has the average two-year variable tracker rate increased since 1 November, but the highly-prized sub-1% deal is now no longer on offer.

The end of record low rates

As the table below shows, mortgage rates have jumped up since the start of the month, with the average two-year tracker rate rising by 0.20% and the lowest rate available seeing the full 0.25% increase. This means it now sits higher than at this time last year, and the average isn't far off either, providing further confirmation that the end of record low mortgage rates is upon us.

Two-Year Variable Tracker Nov-16 May-17 Nov-17 Today
Average Rate 2.02% 1.91% 1.77% 1.97%
Lowest Rate 1.19% 1.09% 0.99% 1.24%


"Less than two weeks have passed since the Bank of England's rate rise and the majority of providers in the variable tracker market have already passed on the increase, causing the average two-year variable rate to jump up and effectively cancelling out any gains made in the past six months," said Charlotte Nelson, finance expert at

"The 0.25% increase to Barclays Mortgage's 0.99% two-year variable tracker rate marks a significant shift in the market and means it's the end of the sub-1% tracker era. Unfortunately, with little room to manoeuvre at such low rates, providers have no choice but to pass on the base rate rise to borrowers."

This is because providers in the tracker mortgage sector are more immediately impacted by any change to base rate. The very nature of tracker mortgages means that as base rate rises, so will mortgage rates, with the quick reactions from providers illustrating the extent to which the market had been preparing for the rise.

SVR impact

However, the same pattern hasn't been seen in standard variable rates (SVRs). In this sector of the market providers have been far slower to react, opting to review their rates thoroughly before announcing any increases – but given that the average SVR stands at 4.66% today, these rates are already significantly higher than those on many other options available to borrowers today, and any increase would surely further impact borrowers' outgoings.

This is why anyone who's currently on their lender's SVR should look to remortgage as soon as possible, before typical mortgage rates have the chance to rise even more. The same applies to those on a tracker mortgage rate, particularly if you think base rate will rise further in the near future; after all, there are still some great deals available, particularly in the fixed rate market, which won't be so readily impacted by base rate changes.

"With some suggesting that another base rate rise could be on the cards next year, borrowers should perhaps consider battening down the hatches and opt for a fixed rate to secure their monthly repayments for a significant amount of time," said Charlotte. "However, with rates likely continuing to rise they will need to act fast to secure the best possible option for them."

What next?

Check out the best fixed rate mortgage and remortgage deals to see if you can get a better rate


Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time. Links to third parties on this page are paid for by the third party. You can find out more about the individual products by visiting their site. will receive a small payment if you use their services after you click through to their site. All information is subject to change without notice. Please check all terms before making any decisions. This information is intended solely to provide guidance and is not financial advice. Moneyfacts will not be liable for any loss arising from your use or reliance on this information. If you are in any doubt, Moneyfacts recommends you obtain independent financial advice.

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