Early 2026 Brings Encouraging Mortgage Rate News – Insights from Anuj Chulani
We’ve seen some encouraging movement in mortgage pricing recently, helped by swap rates continuing to drift downwards. For example, the 5-year swap rate is currently around 0.06% lower than this time last week.
Why does this matter? When the cost of borrowing falls for lenders, it gives them more scope to pass those savings on to customers in the form of lower mortgage rates.
Traditionally, this time of year brings increased competition between lenders as they battle for market share and work towards their annual lending targets. However, lenders are currently being a little more cautious.
This appears to be driven by ongoing political uncertainty, both globally and here in the UK. International tensions and concerns over inflation, combined with the upcoming local elections in May and potential changes in political leadership, are creating a more cautious lending environment.
As a result, lenders are making smaller, incremental rate adjustments rather than launching aggressive pricing moves just yet.
The good news? Once political and economic conditions stabilise, we expect competition to heat up again – and that’s when we typically see stronger rate reductions.
If you’re considering buying, remortgaging, or securing a better deal, now is a great time to review your options and be ready to act as rates continue to improve.
Please get in touch if you’d like a quick, no-obligation mortgage review.
