Sub-4% fixed rate mortgages are rapidly disappearing from the market as lenders reprice products amid rising swap rates and growing uncertainty over the path of Bank of England Base Rate, according to analysis from Moneyfactscompare.co.uk.
The number of lenders offering fixed rates below 4% has fallen sharply in recent weeks, with major banks including Barclays, HSBC, Lloyds Bank, NatWest and Santander all increasing rates since the start of March. Several of those lenders were still offering sub-4% deals only days earlier.
Moneyfacts says the market has not seen the lowest 2- and 5-year fixed rates priced above 4% since February 2025, based on start-of-month data, highlighting how quickly conditions have shifted.
Average mortgage rates remain lower than a year ago, but recent repricing has pushed typical 2- and f5-year fixes back above 5%, while expectations of an imminent base rate cut have weakened.
CAUTIOUS APPROACH
Rachel Springall, finance expert at Moneyfactscompare.co.uk, says the withdrawal of the cheapest deals reflects caution from lenders rather than a fundamental shock to the UK economy.
She adds: “Borrowers looking for the lowest fixed rates will be disappointed to see the demise of sub-4% mortgages, but they are not sustainable with swap rates increasing.
“While many of the biggest lenders no longer offer a sub-4% fixed deal, it is a cautious decision. Mortgage rates are rising due to global pressures, not UK fiscal policy.”
Springall says that recent geopolitical tensions have pushed up swap rates and reduced the chances of a near-term base rate cut.
“These developments have scuppered expectations for the Monetary Policy Committee to vote for a cut to the Bank of England Base Rate, now much more likely for a hold this week.”
MORE HOMES NEEDED
Mary-Lou Press, President of NAEA Propertymark (National Association of Estate Agents), says: “The loss of sub-4% fixed rate mortgages will be disappointing for many buyers, particularly first-time buyers already facing affordability pressures.
“This shift highlights how sensitive mortgage rates are to wider economic uncertainty, making it harder for people to plan and potentially slowing activity across the housing market.
“Even small increases in rates can significantly impact borrowing capacity and monthly costs, reinforcing the need for stability and confidence.
“In the longer term, improving affordability cannot rely on mortgage rates alone. Increasing the supply of suitable homes will be key to supporting a healthy housing market.”
