Mortgage rates in the UK have moved back above 5% after lenders repriced home loans in response to financial market volatility linked to the conflict in the Middle East.

Data from Moneyfacts shows the average mortgage rate rose from 4.97% to 5.04% on 11 March. The typical two-year fixed rate is now 5.01%, while the average five-year deal has reached 5.09%.

It follows a week of turbulence in the mortgage market as lenders reacted to rising swap rates, the wholesale benchmarks used to price fixed-rate loans. These have climbed as markets respond to geopolitical tensions and fears that higher energy prices could push inflation higher.

Major lenders, including HSBC, Nationwide, Halifax, and Barclays, have all increased mortgage pricing across a range of products..

According to Adam French, Head of Consumer Finance at Moneyfacts:

“In the last 48 hours, almost 500 residential mortgage products have been withdrawn as lenders reacted to rapidly rising swap rates.”

It has also had an impact on interest rate expectations. Investors now expect the Bank of England to hold the base rate at 3.75% when its committee meets later this month, with the likelihood of further cuts this year fading.

Around 1.8 million fixed-rate mortgages are due to expire during 2026, meaning many households will soon need to refinance at today’s higher rates. However, mortgage pricing could adjust again quickly if financial markets stabilise and swap rates begin to fall.

Below is a selection of this month’s best buys from Moneyfacts.co.uk:

Two-year fixed rates: 3.95% from first direct. Product fee £490. 60% LTV. For remortgages.
3.99% from Nationwide BS. Product fee £999. 60% LTV.

Five-year fixed rates: 4.04% from first direct. Product fee £490. 60% LTV. For remortgages.
4.09% from Nationwide BS. Product fee £999. 60% LTV

Discounted variable: 3.95% From Progressive BS for 2 years. Product fee £995. 75% LTV.br> 3.99% From Newbury BS For 3 years. Product fee £850. 75% LTV.

BUY-TO-LET (BTL)

Best two-year fixed rate: 2.64% from The Mortgage Works. Arrangement fee 3.00% Advance. 65% LTV.

Five-year fixed rate: 3.63% from Virgin Money. Arrangement fee 3.00% Advance. 60% LTV.

Best Discounted variable: 4.25% For 5 years. From Newbury BS. Arrangement £950. 75% LTV.

The information we provide is our personal opinion and should not be relied upon for financial advice. Should you need financial advice or guidance please contact an appropriate professional.