- Loan default rates are rising, with the Bank of England's Credit Conditions Survey reporting a 6.2 per cent increase in defaults for January to March.
- Secured lending defaults, including mortgages, reached 6.2 per cent in the first quarter of 2026, while unsecured lending defaults, such as credit cards, rose for the fourth consecutive quarter to 18.6 per cent.
- Experts warn that the ongoing Middle East conflict, specifically the Iran war, is adding significant pressure to household finances through rising fuel prices and increased mortgage rates.
- Mortgage rates have jumped, for instance from 4.8 per cent to over 5.5 per cent, adding substantial annual costs for homeowners and making lenders more risk-averse.
- Despite the current challenges and rising defaults, the mortgage and property market is still anticipated to experience increased demand in the coming months, though the full impact of expiring fixed-rate deals and persistent inflation is yet to be seen.
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