Barclays and NatWest have announced major mortgage rate reductions effective from Friday, as competition intensifies in the housing market during the May heatwave. Brokers have hailed a "significant shift" as both lenders slash rates across their ranges.
Barclays and NatWest Rate Cuts
Barclays has reduced its rates by up to 0.43% across the board. The standout deal is its purchase three-year fixed rate at 95% Loan to Value (LTV), which drops from 5.85% to 5.42%, with a fee of £899 and a maximum loan of £570,000. NatWest has trimmed rates by up to 0.54%, with its two-year tracker rate remortgage at 80% LTV, featuring a £995 fee, falling to 4.42%. Coventry Building Society has also unveiled reductions across its range.
These moves follow Santander's rate cuts of up to 0.23% last week and Gen H's reductions of up to 0.3% earlier this week. Experts suggest that easing tensions in the Iran war have contributed to the trend, but caution that sentiment could shift rapidly if hostilities escalate.
Broker Reactions
Justin Moy, managing director of Chelmsford-based EHF Mortgages, noted that swap rates have fallen, filtering through to mortgage rates. He said: "Some significant cuts from a number of high street lenders, as swap rates improve and the likelihood of base rate increases in 2026 recedes. But it's so important for borrowers to act 'quickly' just in case, as we have seen so many times this year, rates can increase with little notice."
Jack Tutton, director of Fareham-based SJ Mortgages, said there was "growing optimism" among brokers. He added: "This marks a significant shift in the market, with many lenders reducing some of their rates today. These widespread cuts are set to increase competition in the mortgage market as summer approaches, bringing welcome news for those planning to move in the coming months. Borrowing costs have fallen over the past month, leading to the reductions released today, and there is growing optimism that this trend will continue with further rate cuts expected in the near future."
Dariusz Karpowicz, director of Doncaster-based Albion Financial Advice, described summer as a "buying season", urging prospective buyers to act. He said: "Welcome news for once. Swaps are easing, base rate fears for 2026 are fading, and the high street has finally taken the hint. Barclays, NatWest and Coventry are all trimming rates, and the timing could not be better with summer and the buying season nearly here. A word of caution, though. Cheaper rates have a habit of vanishing as fast as they appear, so do not sit on your hands. If you are buying or coming to the end of a deal, get your numbers reviewed now and lock something in while the mood is good. Optimism is lovely, but a secured rate is better."
Katy Eatenton, mortgage and protection specialist at St Albans-based Eatenton Finance, urged borrowers to secure rates without delay. She added: "Great news to get what tends to be a quiet time of year ramped up and moving in a positive direction. The downward direction of rates should give comfort to those coming off super-low rates this summer. I still encourage those hoping to move or remortgage this year to lock a rate in early, just in case things change."
Samuel Mather-Holgate, MD and IFA at Swindon-based Mather and Murray Financial, suggested these figures could signal what lies ahead. He said: "The mortgage market is schizophrenic currently, with lenders increasing and decreasing rates week by week and movements within the market daily. It is great to see rates coming down, especially across leading lenders and coordinated moves. This could be a sign of things to come, but with geopolitics indirectly driving mortgage rates anything could happen while Donald Trump is directing policy."
