Richard Merrett, managing director at mortgage firm Alexander Hall, faces a jump in monthly mortgage payments from £550 to £1,650 when his five-year fixed rate expires in early 2027. His 1.14% rate reflects borrowing conditions before rates began rising in 2022, while higher energy prices linked to the Iran war have added to inflation pressure and pushed global bond yields higher. Britain’s 30-year government bond yield exceeded 6% on Thursday, its highest level since 1998, raising lenders’ funding costs. The Bank of England estimated that more than 5 million households could see mortgage repayments rise by the end of 2028, including almost 750,000 borrowers facing an average £170 monthly increase as older fixed-rate deals expire. Mortgage approvals have fallen to their lowest level since the end of 2023, while Nationwide Building Society reported the weakest annual house-price growth since December 2025. Rising mortgage rates are also affecting the United States, the euro area and Australia, though Capital Economics still expects UK 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 put further pressure on borrowing costs and limit the housing recovery.