Spring is traditionally a busy time for the housing market, but this year is more anxious than most as mortgage rates climb amid uncertainty over the Iran war.
Many buyers will feel under pressure to move quickly, especially with the cost of a two-year fixed rate jumping from 5.36% to 5.87% in the last month alone, Moneyfacts figures show.
On a £200,000 mortgage, that’s the difference between paying £10,702 a year and £11,740, adding up to an extra £2,072 over the term.
Joseph Lane, mortgage broker at Mortgage Lane, said this time of year always creates urgency, but the pressure is now even greater. Joseph Lane said: “People feel like they need to move quickly, but pressure leads to mistakes, and in today’s market, those mistakes can be very expensive.”
Whether you’re a first-time buyer, moving home or downsizing later in life, the same rule applies. “Make decisions based on your own situation rather than what you think the market might do,” Lane said.
A common trap is focusing too much on headline mortgage rates. A slightly lower rate doesn’t always mean a better deal. “Fees, incentives, and product structure can completely change the real cost of a mortgage.”
Another mistake is borrowing the maximum on offer. “When lenders tell buyers how much they can borrow, many treat that number as a target rather than a limit. Just because you can borrow a certain amount doesn’t mean you should. Don’t stretch yourself too far at the beginning.”
Buyers should also avoid assuming tensions will ease quickly and rates will fall. “That might happen, but it’s not guaranteed,” Lane said.
It can also pay to boost your deposit if possible. “Sometimes a relatively small increase in deposit can reduce your overall mortgage cost more than people realise.”
Above all, don’t rush. “Take time to understand the process before you commit,” Lane said.
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