Yes you require a new lock the mechanism is on it's way out and requires a new one if you are lucky you will be able to change the centre gearbox only and it will operate like new (look at the face plate area where the handle is and see whether it is fixed with philips or star head screws and you might be able to get a replacement. If it is riveted or spot welded then it is definitely a full lock job) either way it is not a major project and can be done in less than an hour once you have identified a replacement.
Al the lockman www.upvcspares4repairs.co.uk
June 2010