British mortgage borrowers face further cost increases as a global bond-market selloff pushes government yields and bank funding expenses higher. The 30-year UK government bond yield topped 6% on Thursday, its highest level since 1998, while the two-year Sonia swap rate rose 27 basis points in a month to 4.68%. The Bank of England projected that more than 5 million households would see repayments increase by the end of 2028, including almost 750,000 borrowers whose fixed-rate deals are expiring after being agreed during the COVID-era lows. Richard Merrett, managing director at mortgage firm Alexander Hall, said his monthly payment could rise from £550 to £1,650 when his 1.14% five-year mortgage expires in early 2027. The trend is global, with mortgage rates also rising in the United States and euro area, while Australian house prices have declined for six consecutive months. UK mortgage approvals have fallen to their lowest level since the end of 2023, although Capital Economics expects house prices to rise 2.5% in 2027. A possible increase in government borrowing in finance minister John Healey’s first budget on October 28 could further constrain the housing recovery.