Mortgage lenders reversed course on rate cuts in July as rising swap rates and renewed inflation concerns pushed fixed mortgage rates higher, according to Moneyfacts.

The Moneyfacts average new mortgage rate rose by 0.12% from 5.47% in July to 5.59% at the start of August, completely reversing the previous month’s reduction.

The average two-year fixed rate increased by 0.11% to 5.63%, while the average five-year fixed rate rose by 0.14% to 5.66%, the first monthly increases in both rates since April. The average new mortgage rate was last below 5% in March 2026, when it stood at 4.90%.

Moneyfacts said rising swap rates were partly driven by renewed unrest in the Middle East, which pushed up oil and energy prices and fuelled concerns about inflation and the future path of the Bank of England base rate.

The repricing of mortgage ranges also resulted in significant product churn, with the average shelf-life of a mortgage deal falling to just 11 days, three days shorter than the previous month and the lowest since April.

Despite the rate reversal, mortgage availability continued to improve. Product choice increased by 180 deals during July to 7,357, the fourth consecutive monthly rise. The financial data and comparison platform said around 90% of deals withdrawn during the market disruption in March and April had now returned, including greater choice for borrowers with higher loan-to-value requirements.

However, borrowers with only a 5% deposit or equity face average five-year fixed rates above 6% at 95% LTV. The incentive to remortgage remains strong, with the average Standard Variable Rate at 7.13%, although this is down from 7.42% a year earlier. The average revert rate remains significantly higher than current fixed-rate offers.

Rachel Springall, finance expert at Moneyfacts, said: “Lenders were somewhat forced to U-turn on fixed rate cuts in July, knocking back the short-lived progress of three consecutive months of reductions to the average two- and five-year fixed rates.

“Due to the swift action of lenders to re-price their ranges last month, the average shelf-life of a mortgage dropped to 11 days, now its lowest recorded since April, when mortgage turmoil pushed the lifespan of a mortgage down to just eight days. The limited timeframe makes it ever more essential to seek advice early, particularly those who are due to remortgage this year."

Around 750,000 households whose fixed-rate mortgages are due to expire in 2026 are currently paying rates below 3% and are expected to face an average increase in repayments of about £170 a month, according to the Bank of England.

Moneyfacts said delaying the search for a new deal could prove costly given that the average revert rate remains above 7%, although borrowers should shop around rather than automatically refinancing with their existing lender.

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