Copy article

What does Starmer resignation mean for mortgages?

Journalist: Emily Mee, The Sun

ended 22. June 2026

We're putting a piece together on what Starmer's resignation means for your money. It will include a section on mortgages - any comment on this would be helpful please. For example, could borrowing costs go up? Will there be an impact on swap markets? 

5 responses from the Newspage community

Copy all

Copy

Editor
Aaron Strutt
Product and Communications Director at Trinity Financial
While many people seem to be very pleased Sir Keir has gone, there is no doubt that it does mean more instability in the UK economy. Sterling has remained relatively strong against the euro over the past few months despite the challenge to his leadership, but there are now serious risks to sterling exchange rates. Mortgage rates have been coming down for weeks, but these price reductions could slow down. There are also no guarantees that a new prime minister will do a better job.
Copy

Editor
Samuel Mather-Holgate
Managing Director & IFA at Mather and Murray Financial
The resignation itself does not automatically mean mortgage rates shoot up, but it does inject another dose of political risk into an already nervous market. Lenders price fixed rate deals off swap rates, and swaps move when investors think inflation, borrowing or fiscal policy may change. If the next Treasury team is lead by Red Ed Milliband markets will see it as softer on spending, less committed to discipline, and demand a higher premium that can feed through to mortgage pricing. The danger is not one headline, but a loss of confidence. Borrowers do not need Westminster drama- they need boring, credible economic management.
Copy

Editor
Nouran Moustafa
Practice Principal & IFA at Roxton Wealth
Starmer’s resignation does not automatically mean mortgage rates rise, but it does create another reason for lenders and markets to watch the UK more closely.

Mortgage pricing is driven mainly by swap rates, which reflect where markets think interest rates, inflation and government borrowing are heading. If a leadership contest creates concern about looser spending, higher borrowing or unclear fiscal policy, gilt yields can rise. That can push swap rates up and lenders may reprice fixed mortgages higher or become more cautious.

But it is not guaranteed. If the next government gives markets a credible plan on growth, inflation, borrowing and housing, the political reset could be fairly neutral.

For borrowers, the real risk is uncertainty rather than an instant shock. Anyone remortgaging soon should review early and secure an option rather than assuming rates will keep falling. Political drama does not always move mortgages, but when it affects gilt and swap markets, it can.
Copy

Platinum
Elliott Culley
Director at Switch Mortgage Finance
Impactful changes in government, result in markets reacting immediately. Uncertainty and instability will lead to increases in swap rates and as a result the positive redcutions seen over the last week or so will be curbed as the mortgage market waits to see the impact this resignation will have. The next few weeks of the labour leadership contest will also have a huge influence in how the mortgage market reacts.
Copy

Premium
Doug Miller
Director at Lansdown Financial Services
A resignation by the Prime Minister could inject a degree of political uncertainty into financial markets, which can feed through to mortgage pricing. In the short term, swap rates could become more volatile as markets reassess the outlook for fiscal policy, government borrowing and the timing of future Bank of England rate cuts.

That said, any sustained increase in mortgage costs would depend on whether the political change materially alters expectations for inflation, public finances or interest rates. If markets view the transition as orderly and policy continuity is maintained, the impact on borrowing costs may prove limited.

Unfortunately this adds yet another degree of uncertainty in an already volatile market, but many banks announcing multiple interest rates reductions in recent weeks the outlook is certainly not all doom and gloom at the moment!