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HSBC increases rates in "another hammer blow to Britain's beleaguered property market"

ended 22. February 2024

Following other lenders this week, such as Santander, Coventry and TSB, HSBC have just announced they are increasing their rates — and across the board. Newspage asked brokers for their thoughts, which can be found below.

16 responses from the Newspage community

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Michelle LawsonVerified
Director at Lawson Financial
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Another one bites the dust. We have returned to uncertain times in the mortgage and property market. Hopefully things will settle down soon as the property industry is such a trigger for so many others. The yo-yoing is no good for anyone.
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Katy EatentonVerified
Mortgage & Protection Specialist at Eatenton Finance
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HSBC increasing rates will be the final nail in the coffin for consumer confidence in both the banking system and this government. Rates are all over the place, the Bank of England seem to be ignoring the reality of the cost of living crisis and the recent recession announcement.
It won’t be long, if not immediately, that the rest of the big six follow suit.
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Harps GarchaVerified
Director at Brooklyns Financial
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HSBC increasing rates across the board will be a sledgehammer to consumer sentiment. It's another disappointing turn of events, however based on what has been happening over the last few weeks it's no surprise. The queston is, is this a temporary measure or did lenders get over-excited with their January sales?
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Elliott CulleyVerified
Director at Switch Mortgage Finance
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The reversal in rates over the past two weeks is a result of lenders cutting rates sharply in January in a bid to obtain as much business as possible. We are now in the hangover period from the rate war we experienced in January. Lenders squeezed their margins so much that any increase in swap rates, as we are now experiencing, would mean a reversal in rates. This shows how fragile the current market is and that borrowers should remain proactive in the market to ensure they secure the best deal.
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Ashley ThomasVerified
Director at Magni Finance
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HSBC hiking rates is yet another hammer blow to Britain's beleaguered property market. 2024 started on a high but those days now feel like a distant memory as more lenders reprice upwards.
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Laura Bairstow
Founder at The Mortgage Masters
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This is yet another blow to the property market. It's like Deja Vu from last Autumn with lenders pulling rates at short notice, forcing borrowers to rush into making decisions which shouldn't be taken lightly. How does this fit in with Consumer Duty?
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Richard Jennings CeMAP
Founder & Managing Director at Richard Jennings Mortgage Services
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With yet another major lender increasing their product range, almost entirely, it appears the sunshine and promise of January has reverted back to the uncertainty and higher rates seen late last year. Unfortunately there will be many consumers who saw rates declining in January and decided to hold off in the hope of getting even lower deals, now finding themselves being bitten by the increased rates. I don't expect this to change anytime soon. Brace yourself for more quick rate removals and repricing at a higher level.
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Justin MoyVerified
Managing Director at EHF Mortgages
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We are meandering back to the mortgage rates that we had at the end of 2023, effectively cancelling out the momentum we saw in the New Year. In particular, those looking to hit the peak time of house hunting will be disappointed to see HSBC increasing rates, in line with all major lenders recently. If there was ever a time for intervention from the government, Bank of England, it's now before we slip back into the pain of 2023 all over again.
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Jack TuttonVerified
Director at SJ Mortgages
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It's no surprise that HSBC have followed many other lenders and increased their rates. Lenders have held off increasing their rates for a while to see if the market settled back down, but this hasn't happened, leaving them no choice but to increase the rates that they can offer given their ever-tighening margins.
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Riz MalikVerified
Independent Financial Adviser at R3 Wealth
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In a country with no one in the driving seat, it is not surprising that rates are volatile. The Bank of England as well as the government are equally to blame and, left unchecked, things could escalate quickly. After a bright start to the year, the storm clouds are brewing.
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Craig FishVerified
Director at Lodestone Mortgages
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With these latest changes from such a large UK lender, this a clear message to the public that we are closed for business. Most lenders have increased rates recently and it looks set to continue. The joy that was felt at the end of 2023 is long gone, and we are settling in for a long cold winter on the mortgage front, unless there is some positive news in the Spring budget or when the MPC next meet. Such a fragile market means that borrowers need to be very quick if they have to apply for finance in the short term.
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Ken JamesVerified
Director at Contractor Mortgage Services
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It's turning into a topsy turvy kind of market place with yet another rate increase from one of the big lenders. We seem to have returned to the uncertainty and lack of confidence that defined 2023 and this will start to filter though to potential buyers. Those who sat firmly on the fence may now be regretting that decision and will be clammering to get down and secure a deal sooner than later. I think many will be wanting to drop anchor and pray for calmer seas as it's going to get rough.
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Mark Robinson
Managing Director at Albion Forest Mortgages
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We have seen a lot of high street lenders increasing rates this week. I don't think there is anything to panic about and this is all part of normal fluctuations. The rates offered by lenders reflects their appetite to lend, for various reasons, any number of which can create a rate change.
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Gareth DaviesVerified
Director at South Coast Mortgage Services
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I'm getting well and truly fed up with the volatility of lender rates right now. We can't go more than a day or two without things changing, and hikes like these are simply going to knock consumer confidence once again.
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Hannah BashfordVerified
Director at Model Financial Solutions
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This is no suprise but yet another disappointment for borrowers. The optimistic start to the year seems to have diminished and any savings borrowers could have made at the beginning of the year are almost gone. We will be keeping a keen eye on what happens over the next few weeks with the spring Budget looming.
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Anil MistryVerified
Director and Mortgage Broker at RNR Mortgage Solutions
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HSBC is now evidently aligning with the mainstream, delivering a significant setback as we approach Easter next month, a time when a surge in potential buyers is standard. It appears that HSBC, along with other lenders, are poised to capitalise on this period, following the competitive interest rate battles witnessed towards the end of last year, a traditionally quieter period for house purchases. It will be intriguing to observe how lenders respond in the four to six weeks to come.