Someone asked me today what impact the situation involving Iran could have on the UK property market. The short answer is that the main thing to keep an eye on is interest rates.

Over the past six months, mortgage markets had actually been moving in the right direction. Swap rates - which largely determine the cost for lenders to offer fixed-rate mortgages - had been gradually falling. As a result, lenders were able to slowly reduce mortgage rates, which helped improve buyer confidence across the housing market.

However, in the past week we’ve seen a slight shift.

Following the escalation of conflict involving Iran, global oil prices have risen. When energy costs increase, it can feed through into inflation because fuel, transport and production costs rise across the wider economy.

When markets start to worry about inflation, they often assume central banks may need to keep interest rates higher for longer to keep inflation under control. Those expectations quickly feed into swap rates - the benchmark lenders use when pricing fixed-rate mortgages. If swap rates rise, mortgage rates can follow.

Over the past week, five-year swap rates have risen by around 0.2%, moving from 3.9% to roughly 4.1%. That puts them back at levels last seen in March 2025.

While that may sound significant, it’s important to keep it in perspective. Swap rates are still around a third lower than the levels seen in the summer of 2023, when they reached around 5.3%.

As a result of the recent movement, some lenders have already nudged their five-year mortgage rates up slightly - typically by around 0.1% to 0.2%. On a £200,000 mortgage, a 0.2% increase works out at roughly £33 per month.

In terms of the housing market itself, activity remains strong. Last week alone, 25,603 homes sold across the UK - about 5% higher than the 2026 weekly average. Buyers are still buying and homes are still selling.

The recent movement in swap rates doesn’t fundamentally change the direction of the property market.

What it does highlight, however, is something that has always been true: pricing remains key.

Over the long term, the data shows that only around 53.5% of homes that come onto the market actually go on to sell. One of the biggest differences between homes that sell and those that sit unsold is pricing.

Homes that launch with realistic, evidence-based asking prices attract viewings and offers. Properties that come to market with expectations that stretch beyond current conditions often take longer to find a buyer.

So while the market remains active, sensible pricing is still the single biggest factor in achieving a successful move.

Homes priced correctly continue to sell well. Those chasing yesterday’s market often take longer to find their buyer.