UK Mortgage Rates Surpass 5% Amid Product Withdrawals

Average mortgage rates in the United Kingdom have surpassed 5 percent for the first time in seven months, prompting lenders to withdraw nearly 500 residential products from the market in the past 48 hours. The surge, driven by escalating tensions in the Middle East, marks the most significant instability in the sector since the economic fallout following the September 2022 mini-budget.

As of Wednesday, the average two-year fixed-rate mortgage stood at 5.01 percent, up from 4.84 percent at the end of the previous week and the highest level since August 2025. The five-year fixed-rate average reached 5.09 percent, rising from 4.96 percent last Friday and the peak since June 2025. Overall, the average across all fixed deals climbed to 5.04 percent from 4.91 percent. Financial data provider Moneyfacts reported that 472 products, representing about 6.5 percent of the total market, were pulled, leaving 7,164 deals available. This withdrawal rate is the sharpest since late 2022, though it falls short of the 935 products removed in a single day during that period's peak volatility.

The increases stem from a rapid rise in swap rates, which lenders use to price fixed-rate mortgages based...