Global uncertainty is beginning to influence borrower behaviour, with UK homeowners taking a more cautious approach to mortgages and moving plans.
New data from Barclays shows 17% of UK adults say the conflict in the Middle East has impacted their housing decisions, with many acting to protect against potential interest rate volatility.
More than a quarter of homeowners (27%) are now overpaying on their mortgage to reduce future exposure, while 20% of those remortgaging are looking to lock into a new rate as quickly as possible.
The shift comes as mortgage pricing remains sensitive to global events, with rate expectations influenced by inflation, energy markets and wider geopolitical risk.
ECONOMIC UNCERTAINTY
Barclays data also shows a nine percentage point increase year-on-year in the share of customers borrowing for remortgages, reflecting both market conditions and a wave of borrowers rolling off low fixed-rate deals.
At the same time, economic uncertainty is impacting mobility within the housing market, with 29% of homeowners saying it could delay or prevent their next move.
Stamp duty, moving costs and mortgage rates are also cited as key barriers, alongside a widening price gap between properties.
AFFORDABILITY PRESSURES
Affordability pressures are pushing buyers towards lower-value homes, with 73.2% of purchases now below £500,000, while a growing proportion of buyers are entering with smaller deposits.
The data highlights particular pressure on second-steppers, who face the largest financial jump on the housing ladder, requiring average savings of more than £75,000 to fund a move.
Jatin Patel (main picture, inset), Head of Mortgages, Savings and Insurance at Barclays, says: “Periods of geopolitical and economic uncertainty inevitably place greater focus on household finances.
“Borrowers are demonstrating resilience by overpaying where they can, reassessing their mortgage options, and thinking carefully about timing to maintain flexibility and control.”
