UK households hit by mortgage rate warning

Homebuyers told now may be the time to act

A leading building society has announced it is hiking mortgage interest rates in a blow to homebuyers. It comes as other high street lenders have been slashing rates in recent months.

But Coventry Building Society has moved to increase rates on some of its packages. Interest rates have been raised by banks and building societies following the Bank of England's decision to hike the base rate.

Coventry Building Society is increasing selected residential rates, GB News reports. Notably, the high street lender is raising all fixed rates at 65 per cent-75 per cent LTV for new and existing borrowers.

READ MORE: Date confirmed for £200 winter cost of living payments

Experts fear Coventry's move could be sign of things to come. Iain Swatton, the director at Exemplar Financial Services, told Newspage: "The Coventry’s decision to raise residential mortgage rates signals that global tensions, particularly in the Middle East, are starting to affect the market.

"Combined with ongoing uncertainty in the UK economy, this move is a clear warning that other lenders may follow suit in the coming days. Just as confidence was beginning to return, these rate hikes could put pressure on borrowers waiting for the right time. If you’ve been holding off, now might be the time to act before conditions tighten further."

Adam Stiles, the managing director at Helix Financial Partners, added: "The great mortgage rollercoaster continues its ride with Coventry now increasing rates. SWAP rates have risen sharply this week, possibly spooked by the rumour mill and rhetoric coming out of the Treasury for the upcoming Budget, the conflict in the Middle East, and unexpected economic data released in the US recently.

"Time will always tell with these things but for now, we don't expect to see many lenders decreasing rates any further for the time being on certain products."