That meant most of the gains made during the period of falling rates have now been erased.
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.”
Some lenders repriced over consecutive weeks, suggesting volatility in swap rates amid global uncertainty.
She said persistent concerns over the outlook for interest rates had led to swap rate volatility, driven by unrest in the Middle East. The prolonged conflict had pushed up oil and energy prices, raising inflationary fears that could in turn lead to future base rate increases by the Bank of England.
A similar pattern emerged across five-year fixed rates. The average rate stood at 5.38% in August 2024 before falling to 4.94% in February 2026. By August 2026, however, it had climbed to 5.66%.
What mortgage and protection advisers should take from the FCA’s AI stance
Sponsored by Sesame Bankhall Group
That meant all of the rate-cutting gains for five-year fixes had also been reversed.
Borrowers face sharper affordability pressures
Borrowers with the highest loan-to-value (LTV) ratios had seen the sharpest deterioration in affordability.
At their lowest point in February 2026, two-year and five-year fixes stood at 5.42% and 5.41% respectively, but by August 2026 they had risen to 6.2% and 6.08%.
Lower-risk borrowers still secured the cheapest rates overall, but they also experienced some of the largest increases since February.
For borrowers at 60% LTV, the average five-year fixed rate increased from 4.53% in February 2026 to 5.46% in August 2026, a rise of 0.93 percentage points.
For the same 60% LTV borrowers, the average two-year fixed rate rose from 4.21% in February 2026 to 5.17% in August 2026, an increase of 0.96 percentage points.
Remortgagors need to act quickly
Product shelf life had also shortened to 11 days. In contrast, when rates reached their February 2026 lows, products had remained available for an average of 33 days.
The incentive to remortgage had remained strong, Moneyfacts said. Fixed rates had been much lower than the average revert-to rate, or standard variable rate (SVR).
The average SVR stood at 7.13%, down by 0.29 percentage points year-on-year from 7.42%. The highest recorded level was 8.19% during November and December 2023.
Springall added: “The limited timeframe makes it ever more essential to seek advice early, particularly those who are due to remortgage this year.”
Product choice remains above 2024 levels
The market had also expanded over the previous two years, with around 700 more products available than in August 2024, an 11% rise.
This was despite the number of available mortgage products falling since the February peak.
At 95% LTV, the number of available products increased from 353 in August 2024 to 495 in August 2026.
This growth of 40% was reflected in lenders moving toward lower deposit rates, with a view to unlocking affordability for some first-time buyers.
At 60% LTV, the number of products increased from 755 two years ago to 831 in August 2026. This saw the smallest growth of 10%.
Overall, between August 2024 and August 2026, availability rose most sharply at 95% LTV, where product numbers grew by 40%. This compared with growth of 24% at 90% LTV and 10% at 60% LTV.