For borrowers, the interest rate on a fixed mortgage does not change until the deal expires, usually after two or five years, and a new one is chosen to replace it.<\/p>\n
Before the US-Israel war with Iran began, financial markets had expected UK interest rates to be cut this year. In turn, that was reducing lenders’ funding costs and rates on new fixed mortgages were going down. <\/p>\n
The war has upended all of that.<\/p>\n
Now, the average rate on a two-year fixed deal stands at its highest since February last year at 5.51%, up from 4.83% at the start of March, according to Moneyfacts.<\/p>\n
The average rate on a five-year fixed has risen from 4.95% at the start of March to 5.52% today – the highest since July 2024.<\/p>\n
More than a fifth of mortgage products available at the start of the month have been withdrawn.<\/p>\n
Aaron Strutt, of broker Trinity Financial, said lenders had found it almost impossible to price their mortgages and offer new and existing customers fixed rate deals. Rate increases were coming “thick and fast”, he said.<\/p>\n
“It is becoming increasingly difficult for borrowers to work out if they are getting a decent fixed rate and how long they will have to apply for a deal,” he said. <\/p>\n
“I suspect the cheapest rates have a shelf life of three or four days at the moment.”<\/p>\n
David Hollingworth, from broker L&C, said borrowers needed to expect “a turbulent period” for mortgage rates until things in the Middle East became clearer.<\/p>\n
“Let’s hope the talk of an easing in the conflict takes shape which should help the market find a level as it tries to predict what this may mean for the longer term interest rate outlook,” he said.<\/p>\n","protected":false},"excerpt":{"rendered":"For borrowers, the interest rate on a fixed mortgage does not change until the deal expires, usually after…\n","protected":false},"author":2,"featured_media":492603,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[84,1294,56,54,55],"class_list":["post-492602","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-business","tag-economy","tag-uk","tag-united-kingdom","tag-unitedkingdom"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/492602","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/comments?post=492602"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/492602\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media\/492603"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media?parent=492602"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/categories?post=492602"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/tags?post=492602"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}