Average mortgage rates have breached 5 percent for the first time since last summer as lenders continue to withdraw products and reprice in response to volatility from the US-Iran conflict.
Data from Moneyfacts shows the average two-year fixed rate now stands at 5.01 percent, up from 4.84 percent on Friday. The average five-year fixed rate has risen to 5.09 percent from 4.96 percent over the same period.
In the past 48 hours, around 472 residential mortgage products have been withdrawn from the market – approximately 6.5 percent of the total available. Moneyfacts said this represents the biggest decrease in mortgage product numbers since the mini-Budget crisis in September 2022.
Worst turmoil since 2022
Adam French, head of consumer finance at Moneyfactscompare.co.uk, said: “Recent days have been some of the most turbulent in the UK mortgage market since the aftermath of the September 2022 mini Budget.”
French added: “In the last 48 hours, almost 500 residential mortgage products have been withdrawn as lenders reacted to rapidly rising swap rates. However, 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.”
He said many deals were likely to return within the next few days and weeks as lenders adjusted their pricing to higher rate expectations.
This follows Landlord Knowledge’s report last week that BTL rate cuts were placed on hold as swap rates spiked following the escalation in the Middle East. The latest figures show that pricing pressure has now fed through to average rates across the market.
Lenders reprice across the board
Several major lenders have announced increases this week. HSBC has raised pricing on selected residential and buy-to-let products for the second time in two weeks. TSB announced a 50 basis point increase to all residential, BTL, product transfer and additional borrowing rates.
Principality Building Society made increases of up to 0.5 percent to residential, new build, BTL and holiday let pricing. Meanwhile, Skipton Building Society, Hinckley and Rugby Building Society and Precise Mortgages have all withdrawn products or announced temporary rate removals.
Nick Mendes, mortgage technical manager at John Charcol, said: “Swap rates rose sharply earlier in the week as markets reassessed inflation risks linked to higher oil prices and geopolitical tensions, and that pressure is now feeding through into mortgage pricing.”
He added that when a lender of HSBC’s size reprices across so many parts of the market, it often signals margins are being squeezed.
While two- and five-year swap rates fell back by around 10 basis points on Wednesday, suggesting some immediate volatility may be settling, brokers warned that lenders tend to reprice with a lag after sharp movements in funding costs. The RICS survey published today showed buyer confidence has already been affected by the conflict uncertainty.
What this means for landlords
- If you’re remortgaging in the coming weeks: Lock in a rate now if possible – product availability is shrinking and prices are rising. Many lenders allow rate locks up to six months ahead.
- Watch for further withdrawals: With swap rates still elevated, more lenders may pull products at short notice. Check availability before starting applications.
- Limited company landlords: BTL products have been hit alongside residential rates – factor higher financing costs into yield calculations.
- Bottom line: The hoped-for rate cuts following February’s BoE decision have been derailed. Plan for rates staying above 5 percent through spring at minimum.
Editor’s view
The scale matters less than the direction. While 472 products withdrawn is far from the chaos of 2022, it signals that the cheap money narrative has been put firmly on hold. Landlords who delayed refinancing while waiting for better rates now face a tougher market – and that window may not reopen until geopolitical tensions ease.
Author: Editorial Team – UK landlord & buy-to-let news, policy, and finance
Published: 12 March 2026
Sources: Moneyfacts, Mortgage Solutions, John Charcol
Related reading: BTL rate cuts on hold as Middle East conflict spikes swap rates
