HSBC cuts mortgage rates below 5% after weeks of rises, but most borrowers are still paying nearly 6%

HSBC has slashed its mortgage rates by up to 0.19 percentage points, becoming one of the few lenders to buck weeks of painful industry-wide rises. Its cheapest two-year fix now sits at 4.99 per cent — but only for remortgage customers with at least 40 per cent equity in their home. Average fixed rates remain just shy of 6 per cent, squeezing buyers and those rolling off old deals across the country.

Sub-5 per cent deals had nearly disappeared entirely: Moneyfacts counted just nine still available in early October.

The Bank of England has held its base rate at 3.75 per cent for six consecutive meetings since December 2025, and is now expected to raise it as Middle East conflict pushes energy costs and inflation fears higher.

Two-year fixes were available for 3.5 per cent at the beginning of 2026, meaning today's cheapest HSBC deal costs hundreds more per month on a typical loan.