Mortgage Rates Surge Past 5% Threshold Amid Geopolitical Tensions
Average mortgage rates in the United Kingdom have surged beyond the five percent mark, according to the latest data from financial information service Moneyfacts. This significant increase comes amid ongoing concerns about the escalating conflict in the Middle East and its potential impact on global financial markets.
Sharp Increases Across All Mortgage Categories
The average two-year fixed residential mortgage rate reached 5.01 percent on Wednesday, March 11, 2026. This represents a notable jump from 4.84 percent recorded just five days earlier on Friday, March 6. This current level marks the highest point for two-year fixed rates since August 6 of the previous year.
Similarly, the average five-year fixed residential mortgage rate climbed to 5.09 percent, up from 4.96 percent on the previous Friday. This five-year rate now stands at its highest level since June 26 of the preceding year.
The Overall Average Moneyfacts Mortgage rate opened at 5.04 percent on Wednesday, showing an increase from 4.91 percent recorded on Friday. This overall average rate has reached its highest point since August 7 of the previous year.
Significant Product Withdrawals from Market
In a concerning development for prospective borrowers, Moneyfacts reported that 472 residential mortgage products were withdrawn from the market over a 48-hour period. This reduction represents approximately 6.5 percent of the total residential mortgage market, which now offers 7,164 available products.
This represents the most substantial decline in available mortgage product numbers since the aftermath of the September 2022 mini-Budget, which caused significant disruption to the UK housing market.
Industry Experts Voice Concerns
Adam French, head of consumer finance at Moneyfacts, commented on the turbulent market conditions. "Recent days have been some of the most turbulent in the UK mortgage market since the aftermath of the September 2022 mini-Budget," French stated. "In the last 48 hours almost 500 residential mortgage products have been withdrawn as lenders reacted to rapidly rising swap rates."
French offered some perspective, noting that "the scale is nowhere near the shock seen in late September 2022 when 935 products, which accounted for more than a quarter of the market at the time, disappeared in a single day."
The finance expert suggested that "many of these deals are likely to return within the next few days and weeks as lenders adjust their pricing to higher rate expectations."
French expressed concern for borrowers, stating: "It's unwelcome news for borrowers, as the prospect of falling mortgage rates has quickly given way to rate rises. How far they could go is now heavily dependent on how global markets and inflation expectations evolve as conflict in the Middle East unfolds."
Lender Nervousness Evident
Jack Tutton, director at Fareham-based SJ Mortgages, shared his perspective with Newspage, indicating that lenders are showing signs of nervousness. "Lenders are petrified history will repeat itself and the cost of borrowing increases sharply like it did in 2022, when Russia invaded Ukraine and the impact on energy prices that this had," Tutton explained.
The mortgage director provided specific examples of recent lender actions: "We have seen some lenders making significant increases, with both TSB and Accord reacting yesterday with large rate increases, some rates increasing by as much as 0.75 percent."
Tutton analyzed the situation further, noting: "While there has been an increase in swap rates since the start of the conflict, it hasn't been by as much as this and clearly shows lenders are worried about the impact of the war moving forward."
The combination of rising mortgage rates and product withdrawals creates a challenging environment for both current homeowners looking to remortgage and prospective buyers entering the housing market. The situation remains fluid as lenders continue to adjust their offerings in response to evolving economic conditions and geopolitical developments.
