The UK mortgage market has rarely felt as unsettled as it does today. Just as things appeared to be calming, global events, particularly escalating conflict involving the US and Iran, have sent shockwaves through financial markets. For landlords, this volatility is already affecting SWAP rates, lender pricing, and the wider outlook for the buy to let sector.
This update breaks down what's happening in the markets and what it means for your mortgage planning. Plus, how are UK landlords feeling according to fresh data from The Mortgage Works?
Here’s your weekly MFB News update from 4th March 2026.
SWAP Rates: Calm on the Surface, Volatile Underneath
At first glance, the latest SWAP figures look reassuring, but once you dig deeper, the picture becomes far more turbulent. Here’s how the key 2year and 5year SONIA SWAPs compare:
2 Year SWAP Rates
- Current: 3.43%
- One month ago: 3.50% (↓ 0.07%)
- One year ago: just over 4.00% (↓ approx. 0.57%)
On paper, 2 year SWAPs appear to be trending downward both month to month and year to year.
5 Year SWAP Rates
- Current: 3.56%
- One month ago: 3.70% (↓ 0.14%)
- One year ago: 3.89% (↓ 0.33%)
Again, the longer term SWAPs are showing noticeable declines over both time frames.
But here’s the catch, they don’t reflect the sharp intraday swings happening behind the scenes. For example, earlier this week 5year SWAP briefly dropped to 3.47%, slipping under the 3.5% barrier for the first time in years, before bouncing straight back up again.
This kind of movement highlights just how reactive the markets have become to global events and economic data. Even though the month on month and year on year numbers look like progress, the real story is the increasing instability driving lender behaviour.
Lender Pricing: Recent Cuts Likely to Reverse
Ahead of the conflict escalation, many lenders, including Kensington, Foundation, Fleet, and Accord, reduced their rates. Now, with SWAPs bouncing around, lenders are withdrawing limited‑edition products, removing rates at short notice, and preparing for upward repricing. Attractive rates seen recently may not be available for long.
>> Search thousands of buy to let mortgage rates here
How the Iran-US Conflict is Affecting Mortgages
The conflict has driven up global oil and gas prices, increasing inflation expectations. Investors have sold UK government bonds, pushing Gilt Yields higher and raising lenders’ wholesale funding costs.
This typically leads to higher fixed‑rate mortgage pricing. SWAP rates, influenced by long‑term expectations for Bank of England decisions, are sending mixed signals as inflation risk pushes them higher while economic concerns weigh them down.
Interest Rate Outlook
Before recent events, many anticipated a Base Rate cut as early as March. That now appears unlikely. In the short term (3–6 months), mortgage pricing is expected to become more volatile, with lenders likely to reprice upwards. In the medium term (6–24 months), forecasts still suggest rates may fall gradually, depending on economic conditions.
Why Landlords Should Act Now
If you need a mortgage within the next 6-7 months, acting now could be beneficial. Applying early allows you to secure today’s rates and switch to lower pricing later if lenders reduce rates before completion. Many lenders honour mortgage offers for up to 6 months, giving you valuable protection during uncertain times.
>> Search thousands of buy to let mortgage rates here
Landlord Sentiment: Insights from The Mortgage Works
The latest TMW landlord report reveals:
Buying & Selling Activity
5% of landlords bought a property in the last 12 months, showing how cautious the market has become.
- 12% bought in the North East, suggesting investors still see strong yields and affordability there.
- 24% of landlords sold a property last year, and many are consolidating portfolios as costs rise.
- 32% sold in the North West, indicating increased repositioning or exits in that region.
Rental Increases & Void Periods
- 27% of landlords increased rent, reflecting pressure to offset mortgage and running cost rises.
- 41% experienced a rental void, a stark reminder that cash flow can be impacted even in strong markets.
- Voids rose to 56% in the East of England, suggesting softer tenant demand or higher competition locally.
Confidence Levels
- 30% feel positive about rental yields, indicating that confidence remains muted as costs and regulation evolve.
- 39% in the North East are positive about yields, reinforcing why buying activity is higher there.
- Only 13% feel optimistic about capital gains, reflecting slower houseprice growth.
- Just 2% feel positive about the UK economy, indicating a cautious mindset across the sector.
Profitability
- 85% of landlords remain profitable, suggesting that despite challenges, most portfolios are still performing well.
- 90% in the South East report profits, this is likely supported by strong rental demand.
- 13% in Wales report losses, likely due to higher void rates in the region.
Final Thoughts
Markets are entering a turbulent phase. Global events are strongly influencing UK mortgage pricing, and uncertainty is likely to continue. Acting early, securing rates, and seeking expert guidance can help landlords navigate this challenging period with greater confidence.
Next Steps
Get in touch, call our experts on 0345 345 6788 or submit an enquiry here to see how we can help.
