Nationwide has cut its mortgage rates for the second time in seven days, reducing home loan prices by 0.28 percentage points in its latest move.
The building society’s latest reduction follows a 0.12 percentage-point cut on 10 June, signalling growing confidence that rate pressures may finally be easing.
The back-to-back cuts come as expectations of a Bank of England interest rate hike cool following the US and Iran sealing a peace deal.
The agreement has brought long-awaited calm to financial markets, offering some relief to both borrowers and lenders who have endured months of volatility.
Swap rates, which serve as the primary benchmark for pricing fixed-rate mortgages over 2, 5, and 10-year terms, had been swinging sharply on inflationary pressures driven by soaring oil prices.
Those same pressures had pushed back expectations of any rate cut, with Lloyds Banking Group forecasting in its first-quarter results that the first reduction would not arrive until the third quarter of 2027.
Oil has since fallen to a three-month low below $83 per barrel following confirmation of the Middle East deal, easing the energy shock that has gripped global economies.
In the US, inflation hit a three-year high of 4.2 per cent in May, while fresh UK inflation figures are set to be released on Wednesday ahead of Thursday’s Bank of England decision.
David Hollingworth, associate director at broker L&C Mortgages, said the peace deal should “give mortgage lenders more room for manoeuvre and could pave the way for others to cut rates in response.”
Hollingworth added: “Of course there’s been so much uncertainty that it’s been a bumpy ride for market rates, so we can’t assume that it’s one way traffic but a peace deal that persists should brighten the outlook for mortgage borrowers.”
The mortgage market endured significant turbulence throughout the conflict, with the average deal remaining on the market for just eight days in March, the lowest since records began in November 2011.
That figure represented a sharp fall from 14 days in February, before the conflict escalated, and undercut the previous record low of 12 days set in July 2023.
Overall product choice in the market shrank by around 1,283 deals, falling below 7,000 available mortgages for the first time since November 2025, when markets were rattled by tax speculation ahead of the Autumn Budget.