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Mortgage Rates Skyrocket Amid Middle East Conflict
18 Mar
Summary
- New mortgages now cost nearly £800 annually more.
- Interest rates for a two-year fixed mortgage rose significantly.
- Many sub-four percent fixed mortgage offers have been withdrawn.
The cost of new mortgages has increased by nearly £800 annually following the outbreak of war in the Middle East. This financial impact, termed 'Trumpflation', is affecting Britons as interest rates on fixed-rate mortgages have seen a notable rise. For instance, a £250,000 two-year fixed-rate mortgage now carries a rate of 5.28%, up from 4.83% at the start of March.
This surge means buyers and homeowners renewing fixed-rate deals face higher payments. Lenders have not only increased prices but have also withdrawn numerous deals, particularly those offering rates below four percent. Previously, 490 such deals were available; now, only nine remain. The overall mortgage product availability has also fallen significantly since early March.
Experts advise potential borrowers to act swiftly and seek professional advice due to market volatility. The expectation of rising interest rates, even short-term, influences lenders' pricing strategies. While some competitive deals may still exist, the trend suggests potential further increases and a need for borrowers to brace for continued fluctuations.
