Market Movements
The Sub-4% Era Ends: Nationwide and HSBC Lead a Week of Sweeping Rate Increases
Nationwide increased fixed rates by up to 35bp and HSBC repriced its entire residential range effective 23 March. The last sub-4% fixed rate has been withdrawn from the market as lenders scramble to protect margins.
A Line Has Been Crossed
As of this week, there is no longer a single sub-4% fixed-rate mortgage available from any major UK lender. Nationwide — the last holdout — increased its fixed rates by up to 0.35 percentage points on 24 March, pushing its cheapest 2-year fix at 75% LTV from 3.94% to 4.67%.
The move came alongside HSBC's broad-based repricing effective 23 March, which saw increases of 20–60bp across residential, buy-to-let, fee saver, and Premier Exclusive products. HSBC's 2-year fix at 75% LTV jumped from 4.59% to 5.19% — a staggering 60bp increase in a single move.
The Full Picture: Who Moved and By How Much
| Lender | 2yr Fix (75% LTV) | Change | Effective Date |
|---|---|---|---|
| HSBC | 5.19% | +0.60% | 23 March |
| Nationwide | 4.67% | +0.73% | 24 March |
| NatWest | 4.69% | +0.37% | 17 March |
| Barclays | 4.66% | +0.88% | 25 March |
| Santander | 4.98% | +0.39% | 26 March |
The scale of these increases is remarkable. In aggregate, the average 2-year fix across our tracked lenders has risen by approximately 55bp in March alone — the sharpest monthly increase since October 2022 when the Truss mini-budget sent markets into a spin.
Why the HSBC Increase Stands Out
HSBC's 60bp single-day increase on its 2-year fix is the largest individual move we have recorded since launching RateWatch. For context, HSBC started 2026 with a 2-year fix at 3.66% — it is now 5.19%, a rise of 153 basis points in under three months.
The bank also increased tracker rates, fee saver products, and its Premier Exclusive range — suggesting this is a fundamental repricing of their mortgage book, not just a marginal adjustment.
Nationwide's Move Kills the Last Cheap Fix
Nationwide had been the last major lender offering a sub-4% 2-year fix. Their product at 3.94% (75% LTV, effective 6 March) attracted significant volumes of applications as competitors raised prices around them. The 73bp increase to 4.67% brings them in line with the broader market.
Their 5-year fix also rose sharply — from 4.13% to 4.75%, a 62bp jump — while tracker products saw smaller adjustments of around 10–15bp.
Where Are Rates Heading?
Two-year swap rates remain elevated above 4.1%, suggesting fixed mortgage pricing around 4.5–5.2% is sustainable in the current environment. Further increases are possible if:
- Middle East tensions escalate further, pushing oil above $100/bbl
- UK CPI prints above 3.5% in the next release
- The BoE signals rates could stay higher for longer — or even rise
Conversely, any de-escalation in the geopolitical situation could see swap rates retreat quickly, opening the door for lender repricing downward. But that is not the base case right now.