Andy Burnham and UK Mortgage Rates: Will His Rise Push Them Higher?

Andy Burnham has returned to Parliament, and the bond market wasted no time reacting. Gilt yields rose, the swap rates that price fixed mortgages followed, and the same week brought borrowing figures showing the deficit running well ahead of forecast. For anyone with a remortgage on the horizon, a Westminster leadership contest has quietly become a question about the rate on their next deal. This is a broker's read on what Burnham's rise means for UK mortgage pricing, and what to do about it.

If your fixed deal ends in the next six months and the headlines have you wondering whether to lock in now, it pays to get a clear read on your options before pricing moves again: call 01202 155992 or contact Mortgage One.

What Andy Burnham's Makerfield win actually changes

Andy Burnham won Makerfield on 18 June with 54.8 percent, returning to Parliament after eight years as Mayor of Greater Manchester. Once sworn in he can challenge Sir Keir Starmer for the Labour leadership, which needs at least 81 Labour MPs. For mortgages, the threat is indirect but real, and it runs through the bond market.

Markets do not fear Burnham the man. They fear what a leadership change could mean for borrowing and spending discipline, and on that front the timing was unkind. Official figures released the same week showed the public sector borrowed £23.3 billion in May 2026, up 30.4 percent on a year earlier and £5.6 billion above the official forecast.

Government debt interest alone reached £11.7 billion in May, the highest for any May on record, a reminder that higher gilt yields feed straight back into the cost of running the country. A potential leader seen as more willing to borrow, arriving in the same week as numbers like these, is exactly the mix that puts bond investors on edge.

How do gilt yields and a leadership challenge reach your mortgage?

When investors doubt a government's borrowing discipline, they demand higher yields to hold its debt, and UK gilt yields rose. Long-dated gilt yields move in step with swap rates, which set the price of fixed mortgages. So political risk that lifts gilt yields can push fixed mortgage rates up, even with the base rate unchanged.

The 30-year gilt yield had already climbed to its highest level since 1998 during the May turmoil, and Burnham's win gave it fresh reason to stay elevated.

The bond market does not wait for a leader to actually change. It prices the odds and the likely direction in advance, which is why fixed pricing can harden on political news long before anyone reaches Number 10. You can see the market's expected path for Bank Rate in our SONIA futures forecast.

What are swap rates doing, and why do they matter now?

Swap rates do most of the work on fixed mortgage pricing. Two-year and five-year SONIA swaps had been easing through May as inflation softened, letting lenders trim fixed deals to an average two-year fix of 5.64 percent by 8 June. Burnham's win has pushed in the other direction, putting that hard-won easing at risk.

A two-year fix is priced from the two-year swap plus a lender margin, and a five-year fix from the five-year swap, so the two can move apart depending on where markets see rates settling. When swaps fall, lenders gain room to cut. When they rise on inflation or political risk, that room vanishes and deals get repriced or pulled within days. You can check where average pricing sits today on our current UK mortgage rates page.

Where fixed and tracker mortgage rates stand in June 2026

Average fixed rates have come down but remain high. On 8 June 2026 the average two-year fix stood at 5.64 percent and the five-year at 5.60 percent, according to Moneyfacts, far above pre-2022 levels. The average standard variable rate sits at 7.13 percent, the default many borrowers roll onto.

The Bank of England held its base rate at 3.75 percent on 18 June in a 7 to 2 vote, set out in full in our 18 June Bank of England rate decision. That split was more hawkish than April's 8 to 1 and shows the cutting cycle is firmly on pause. Tracker and standard variable rates track the base rate directly, so they were untouched by the hold, while fixed pricing keeps taking its cue from swaps.

Lender pricing is moving both ways. Through early June, Nationwide, NatWest, Barclays, TSB and Santander all trimmed selected fixed rates, the June 2026 mortgage rate cuts we have been tracking, even as product choice climbed above 7,000 deals for the first time since March.

Deals are turning over within days in this market, and a free initial consultation will show whether locking in now beats waiting, for your own numbers rather than the headlines: call 01202 155992 or contact Mortgage One.

Should you fix your mortgage now or wait?

There is no single right answer, and it turns on your deal end date and your appetite for risk. Fixing now shuts out the danger that political turmoil drags swaps and fixed rates higher before your deal completes. Waiting can win if markets calm and swaps fall, but it leaves you exposed if they climb instead.

If your deal ends within the next several months, many lenders let you secure a rate in advance and switch to a lower one if pricing improves before completion, which hands you insurance either way. Breaking a fix early rarely pays, because the early repayment charge usually swallows the saving. Our full guide on whether to fix now or wait walks through the trade-off, and a whole of market broker can run your actual numbers against it.

Whether you fix now or hold comes down to your timeline and how much rate risk you can stomach, and weighing that with you is exactly what a broker does: call 01202 155992 or contact Mortgage One.

Back to UK Mortgage Rate Forecast

The information provided in this article is for general guidance only and does not constitute personal or regulated financial advice. If you'd like to understand what these moves could mean for you, speak to Mortgage One. We can explain your options and timings based on your specific circumstances.

FAQs

1. Do swap rates affect my mortgage rate?

Swap rates set the price of fixed mortgages. Lenders fund fixed deals in the swap market and add a margin, so when two-year or five-year swaps rise, fixed rates usually follow, and when swaps fall, lenders can cut. Trackers and variable rates follow the Bank of England base rate instead.

2. What are gilt yields, and why do they matter for mortgages?

Gilt yields are the interest rates investors charge to lend to the UK government. They rise when markets worry about borrowing or inflation. Because long-dated gilt yields move closely with swap rates, a sustained rise in gilt yields tends to feed through into higher fixed mortgage pricing.

3. How do government borrowing figures affect mortgage rates?

Heavy borrowing can push up the yields investors demand to hold government debt. UK borrowing hit £23.3 billion in May 2026, around 30 percent above a year earlier and over forecast. Higher gilt yields tend to lift swap rates, and swap rates drive fixed mortgage pricing, so weak public finances can reach your mortgage indirectly.

4. Will UK mortgage rates rise because of the Labour leadership challenge?

Not automatically. The uncertainty has pushed gilt yields and swap rates higher, which puts upward pressure on fixed mortgage pricing. Whether it turns into higher rates depends on how long the turmoil lasts and how it sits alongside inflation and the Bank of England's next move.

5. Did the Bank of England change interest rates on 18 June 2026?

No. The Monetary Policy Committee voted 7 to 2 to hold the base rate at 3.75 percent on 18 June 2026, with two members preferring a rise to 4 percent. Tracker and variable rate borrowers saw no change from the decision itself.

6. Are UK mortgage rates going up or down right now?

They had been easing. Average fixed rates fell through May and into June as swaps softened, with the average two-year fix at 5.64 percent on 8 June. The political backdrop has since added upward pressure, so the direction from here is hard to call.

7. Can a mortgage broker help me decide whether to fix now?

Yes. A whole of market broker can compare fixed and tracker deals across multiple lenders, weigh the cost of securing a rate now against waiting, and factor in your deal end date, any