Current Situation
The upheaval in the mortgage market is the biggest since the aftermath of the 2022 mini-budget. Average mortgage rates in the UK have surpassed 5%, driven by turmoil in the home loan market caused by the ongoing conflict in the Middle East.
As of March 11, 2026, the average two-year fixed-rate mortgage has reached 5.01%, while the typical rate on a five-year mortgage is now 5.09%. This sharp rise in rates has led to nearly 500 mortgage deals being pulled in the past 48 hours, marking a significant shift in the lending landscape.
In total, 472 residential mortgage products were withdrawn from the market recently, reflecting the heightened uncertainty among lenders. Adam French, a housing expert, noted that recent days have been some of the most turbulent in the UK mortgage market since the aftermath of the September 2022 mini-budget.
French commented, “It’s unwelcome news for borrowers, as the prospect of falling mortgage rates has quickly given way to rate rises.” He further explained that the extent of future rate changes will depend heavily on how global markets and inflation expectations evolve as the conflict unfolds.
Despite the current turmoil, French indicated that many of the withdrawn deals are likely to return within the next few days and weeks as lenders adjust their pricing to align with higher rate expectations. However, the exact impact of the Middle East conflict on future mortgage rates remains unclear. Details remain unconfirmed.
The base rate is expected to be held at 3.75% at the central bank’s meeting on March 19, 2026, which could further influence mortgage rates in the coming months.