Barclays moves to lower mortgage costs across key products

Specifically, the bank has reduced rates on more than 20 mortgage products, following similar moves by major market players such as HSBC UK, Halifax, Santander UK, and TSB Bank. At the same time, Virgin Money UK announced a 0.5 percentage point reduction in its five-year fixed-rate mortgage products.

This activity follows a period of sharp increases in swap rates—the key benchmark for pricing fixed-rate mortgages—which led to a significant rise in borrowing costs. In recent days, however, a degree of stabilisation has been observed, although rates remain substantially higher compared with the beginning of the year.

According to data from Moneyfacts, the average rate for a two-year fixed mortgage now stands at approximately 5.87%, up from 4.83% at the beginning of March, while the equivalent five-year fixed rate has risen to 5.76% from 4.95% one month earlier.

Market volatility peaked in March, when the average shelf life of a mortgage product fell to just eight days—the lowest level since 2011—reflecting heightened market uncertainty and frequent repricing.

At the same time, the number of available mortgage products has declined significantly, falling below 7,000 for the first time since late 2025, amid increased uncertainty over fiscal policy and economic prospects.

Market participants note that lenders are now implementing aggressive rate reductions in an effort to stimulate demand following a particularly turbulent two-month period. However, borrower attention is increasingly focused on the upcoming decision by the central bank, which is expected to provide clearer signals on the future path of interest rates.

Meanwhile, the latest data from the Office for National Statistics showed that inflation accelerated to 3.3% in March, up from 3% in the previous month, driven primarily by rising energy prices following geopolitical developments in the Middle East.

In this environment, the trajectory of interest rates and the stabilisation of financial markets will be key determinants for the recovery of the UK housing market.