{"id":450760,"date":"2026-05-29T08:04:09","date_gmt":"2026-05-29T08:04:09","guid":{"rendered":"https:\/\/www.newsbeep.com\/nz\/450760\/"},"modified":"2026-05-29T08:04:09","modified_gmt":"2026-05-29T08:04:09","slug":"it-feels-unfair-the-britons-struggling-to-get-a-mortgage-since-iran-war-began-mortgage-rates","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/nz\/450760\/","title":{"rendered":"\u2018It feels unfair\u2019: the Britons struggling to get a mortgage since Iran war began | Mortgage rates"},"content":{"rendered":"

Prospects of cuts in UK interest rates in 2026, which were widely expected at the start of the year, were rapidly extinguished when the Iran war started<\/a> at the end of February. The renewed threat of inflation means the Bank of England is now expected to raise rates at least once this year, with mortgage costs<\/a> staying higher for longer.<\/p>\n

The boss of Britain\u2019s largest housebuilder said on Thursday it was the most challenging time to be a first-time buyer<\/a> since the 2008 financial crisis.<\/p>\n

We asked people about their experience of housing and mortgage rates after the start of the conflict in the Middle East.<\/p>\n

\u2018We had to pull out of buying a home\u2019<\/p>\n

Panos, 36, an executive sous chef, and his wife had put in an offer to buy their first house \u2013 a three-bedroom, in Hanwell, west London \u2013 but the interest rate on the mortgage they going to take out jumped after the start of the war.<\/p>\n

When he spoke to his mortgage broker on 13 April, he was told the original rate of 4.18% on a five-year fixed rate that had been available at the beginning of February was now 5.22%.<\/p>\n

\u201cI asked the broker to explain this to me in plain English, and he told me our payments would rise from \u00a32,600 a month to \u00a33,100,\u201d says Panos. \u201cWe could not afford this \u2013 it would mean all my wages would go into paying for the house, and we would have to rely on my wife\u2019s wage, which is not very high. It couldn\u2019t be done. We were heartbroken as we had to pull out.\u201d<\/p>\n

The couple, who are keen to start a family, will now continue to rent until mortgage rates improve.<\/p>\n

\u201cThere is so much uncertainty,\u201d Panos says. \u201cI have been renting for more than 10 years and I was really looking forward to becoming a homeowner in 2026, but it will have to wait. I can\u2019t believe that something happening on the other side of the world is affecting England, and everyone in the world.\u201d<\/p>\n

\u2018We took a gamble and lost\u2019<\/p>\n

Edward, 47, who is married with one son and lives in Staffordshire, says the family are still renting after selling their house. A combination of mortgage rate increases and fewer suitable properties on the market has scuppered their goal to buy.<\/p>\n

\u201cWe were betting on interest rates going down, which seemed an almost certainty at that time<\/a>,\u201d says Edward, a producer. \u201cThen, when things couldn\u2019t get any worse, the war happened, and mortgage rates just skyrocketed day by day.\u201d<\/p>\n

They had sold their house last October, and gave themselves a target of six months of renting to find a new home to buy. However, halfway through their tenancy, they were served a section 21 eviction notice as the owner\u2019s personal circumstances dictated they needed the house back.<\/p>\n

\u201cWe still hadn\u2019t found a house to buy as the usual spring uptick in listings was yet to happen,\u201d says Edward. \u201cThe rental market also started to dry up.\u201d<\/p>\n

In mid-April, they found another place to rent. Edwards says it is more expensive and smaller than first place they rented, but there were slim pickings.<\/p>\n

With the rise in mortgage rates, the family have had to dramatically revise their expectations of what their next house will be. Now they are looking at properties they would have previously rejected.<\/p>\n

\u201cWhat houses we could view to buy seemed to be having a rush on from other desperate buyers \u2013 even a week\u2019s delay to view meant a house that was affordable quickly became unaffordable,\u201d says Edward. \u201cNo one seems to be listing at the moment.<\/p>\n

\u201cWe took a gamble and lost.\u201d<\/p>\n

\u2018I\u2019ve pushed the repayment date to 2049 \u2026 I\u2019ll be 72\u2019<\/p>\n

Jonathan, 49, an academic and single parent who lives in Leicester, says he is worried he has had to push the repayment date of his mortgage \u201cwell beyond\u201d his retirement.<\/p>\n

In January, he was in the process of refixing his mortgage on his two-bedroom terrace house and had a rate of 3.6% agreed for two years, but at the beginning of February he was told that after checks the rate would need to rise to 3.97%. However, at the beginning of April, Jonathan was informed that the bank had changed its borrowing criteria and had withdrew its offer.<\/p>\n

\u201cI was contacted by my broker that day, who said I no longer qualified for this mortgage with them,\u201d he says. \u201cMy broker said he didn\u2019t know why it had been withdrawn \u2013 it could be the loan-to-value rate, or the fact that I have some additional borrowing to pay for house improvements.\u201d<\/p>\n

Jonathan has now secured a rate of 5.2% fixed for two years, costing him an extra \u00a3150 a month, and hopes that by the time he needs to refix again the rates will be better and he\u2019ll be able to adjust the repayment date to before he retires.<\/p>\n

\u201cI have pushed the mortgage repayment date to 23 years or 2049, he says. \u201cI will be 72 then.\u201d<\/p>\n

\u2018I know I\u2019m not the only person experiencing this\u2019<\/p>\n

Grace*, 27, had a mortgage deal agreed in principle for a house in late January to early February, but when that purchase fell through, she was advised to keep the deal and look for another property in Northamptonshire, although things did not go to plan.<\/p>\n

\u201cFor the first house, I was offered a five-year fixed rate at 4.09%,\u201d she says. \u201cI was borrowing \u00a3174,000 and putting down a deposit of \u00a347,000.\u201d<\/p>\n

In March, Grace, who works for the NHS, found a three-bedroom house she wanted, and was advised by her mortgage broker she could borrow the upper limit of the agreement, which was \u00a3188,000, in principle.<\/p>\n

However, during Easter, the bank said she needed a new mortgage deal \u201cbecause the sale would not go through in time\u201d, something her mortgage broker disputed. The bank then said the most it could offer was a \u00a3134,000 mortgage.<\/p>\n

\u201cI just didn\u2019t have another \u00a350,000 to add on to the deposit,\u201d she says. \u201cI panicked.\u201d<\/p>\n

The bank said the decision was down to affordability, but Grace says her circumstances hadn\u2019t changed. It then said it was due to her credit score. But Grace said her score was \u201cgood\u201d.<\/p>\n

Her mortgage adviser appealed against the decision. The appeal was accepted, with the bank stating it would reduce the offer by \u00a318,000, rather than \u00a354,000.<\/p>\n

That offer is 5.2% on a \u00a3170,000 mortgaged fixed for five years. Grace is paying \u00a3235,000 for the property and putting down a \u00a367,200 deposit.<\/p>\n

\u201cI know I\u2019m not the only person experiencing this, but it feels a bit unfair,\u201d she says. \u201cMy friends who are in their 20s and early 30s tell me they\u2019ve stopped looking for houses because of issues with mortgages. They\u2019ve given up on buying a house until things cool down.\u201d<\/p>\n

* Name has been changed<\/p>\n","protected":false},"excerpt":{"rendered":"Prospects of cuts in UK interest rates in 2026, which were widely expected at the start of the…\n","protected":false},"author":2,"featured_media":450761,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[138,219,111,139,69],"class_list":["post-450760","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-business","tag-economy","tag-new-zealand","tag-newzealand","tag-nz"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/450760","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/comments?post=450760"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/450760\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media\/450761"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media?parent=450760"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/categories?post=450760"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/tags?post=450760"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}