Three words: worst-case scenario. The Bank of England held base rate at 3.75% on 30 April 2026, but buried inside its May Monetary Policy Report is a warning that should stop landlords in their tracks. If UK inflation doubles to 6.2%, the Bank says it may need to deliver up to six consecutive quarter-point rate rises to bring it back under control (Bank of England Monetary Policy Report, May 2026).

That is a 1.5 percentage point increase from where we sit today. Run the numbers on a typical portfolio and the monthly cost impact is significant.

What the Bank Actually Said

The Monetary Policy Committee (MPC) voted eight to one to hold at 3.75% (Bank of England, 30 April 2026). One member voted for an immediate 0.25 percentage point increase to 4%.

The trigger for the worst-case scenario is oil. The ongoing Middle East conflict has shut down shipping through the Strait of Hormuz. That route carries roughly a fifth of global oil and liquefied natural gas (LNG) (Estate Agent Today, May 2026). With oil prices around $130 per barrel in that scenario, energy costs feed directly into CPI (Consumer Prices Index) inflation.

CPI already sat at 3.3% in the 12 months to March 2026 - more than double the Bank's 2% target (Bank of England, May 2026). If the energy shock pushes it to 6.2%, the Bank's own modelling suggests base rate could move from its current 3.75% up to 5.25%, through a sequence of up to six quarter-point rises.

What Six Rate Rises Mean for Your Monthly Payment

Here is where it gets real. Take a standard £200,000 interest-only BTL mortgage currently priced at a tracker rate roughly 1.5 percentage points above base - approximately 5.25% today.

Monthly interest now: £200,000 x 5.25% / 12 = £875 per month.

Six quarter-point rises add 1.5 percentage points, taking the rate to 6.75%.

Monthly interest then: £200,000 x 6.75% / 12 = £1,125 per month.

That is £250 extra every month. On a two-property portfolio at the same values, you are looking at £500 per month in additional interest costs.

Lender stress tests - the affordability calculations lenders run to check you can cover repayments at a higher rate - are already tight. Six rises would push many existing portfolios below the threshold needed to refinance at current LTV (loan-to-value) ratios.

Is This the Base Case?

No - and that matters. The Bank's central forecast does not assume six rises. The MPC base case still points toward a gradual easing cycle. The six-rise scenario only activates if inflation genuinely breaks above 6%.

But lenders are already responding to uncertainty. Swap rates - the benchmark costs banks use to price fixed-rate mortgages - spiked sharply after the Middle East escalation began. Several major lenders raised fixed rates in March 2026 before cutting them again in April as the situation steadied (Estate Agent Today, May 2026).

The risk is real even if the probability remains low. If your fixed rate expires in the next six months, your monthly payment could look very different depending on how events develop.