Average five-year mortgage rate hits 6% for first time in three years

The average interest rate on a new five-year fixed mortgage deal has hit 6% for the first time in three years, figures show.

The cost of home loans has been rising in recent weeks, as lenders face higher costs amid international concern over rising prices and interest rates.

It means home buyers and anyone renewing a fixed deal have seen about 1,500 mortgage deals priced below 5% vanish since the start of September, according to the financial information service Moneyfacts.

It described the situation as "brutal" for borrowers, with the average rate on five-year deals now at 6%, and at 5.98% on two-year fixed mortgages.

For borrowers, the interest rate on a fixed mortgage does not change until it expires, usually after two or five years, and a new one is chosen to replace it. The vast majority of homeowners and buyers have this kind of mortgage.

Since the Iran war began, global economic uncertainty has been pushing up the cost of deals.