Stock market unrest has been widespread in recent days. However, as five years have passed since the UK lockdown in March 2020, product choice for borrowers and savers has shown it can prosper after market turmoil.
The latest analysis by Moneyfactscompare takes a deeper dive into the flow of product choice to provide a snapshot of how these markets can overcome unprecedented times of instability.
On 23rd March 2020, there was a nationwide lockdown announced in the UK and this had an unprecedented impact on product choice for borrowers, but it also impacted savers.
Mortgage product choice more than halved between 1st March 2020 and 1sy May 2020, plummeting from 5,222 deals to just 2,566. Choice at higher loan-to-values nosedived.
Between 1st September 2022 and 1st October 2022, the mortgage market noted its biggest monthly drop of product choice since the pandemic, with a drop of 1,632 deals (down from 3,890 to 2,258). As of 1st April 2025, there are 6,870 mortgages on the market.
Savings product choice (including cash ISAs) also fell by 220 deals between March and May 2020, dropping from 1,768 deals to 1,548.
The choice of savings accounts hit a record low in April 2021, of 1,340. Moving into 2022, savers were then hit by rising inflation, eroding their cash in real terms. As of 1 April 2025, there are 2,191 savings products on the market.
Rachel Springall, finance expert at Moneyfactscompare, commented: “As consumers fear for their investments and pension pots over stock market turmoil, it’s important they take time to seek advice and ensure they are comfortable with their future goals so that they do not make any knee-jerk reactions they might come to regret later down the line. In terms of how mortgage borrowers and cash savers may be affected, it is worth pointing out that lenders and savings providers will be watching markets closely right now, such as swap rates, to see how such volatility will play a part in their pricing strategies. As it stands, product choice for consumers across savings and mortgages is thriving, but should there be an unexpected dip, these markets have demonstrated how they can bounce back and overcome years of turmoil.
“Five years ago, the Covid-19 pandemic and UK lockdown set in motion an unprecedented situation for consumers. Not only did this impact people’s everyday lives, but the turmoil caused havoc for lenders and savings providers. Whether someone was buying a home or saving a pot for their future goals, the years that ensued where challenging to say the least. Those consumers looking at their current situation would do well to make every effort to budget and save to help them cover any unexpected costs. Thankfully, there was a rise to the households’ savings ratio, according to the ONS during Q4 2024, up to 12% from 10.3% the previous quarter. This is a record high outside of the significant jumps seen around the UK lockdown.
“There is an abundance of choice for mortgage borrowers, and there is a big expectation for lenders to do more to stimulate UK growth. The positive recovery in mortgage choice comes after a dramatic five years of ups and downs. Mortgage product choice nosedived after the UK entered lockdown in March 2020, with over 2,000 deals lost, more than halving the number of residential mortgages on sale between the start of March and May 2020. Lenders sought to support their existing customers amid the crisis, such as those unable to work or furloughed. On the other hand, lenders reined in their intentions to lend out to new buyers, such as first-time buyers with small deposits as they reassessed their level of risk, but as a result it took five years for the quantity of deals at 95% loan-to-value to recover. Overall, it took several months for overall product choice to breach 5,000 options (November 2021 – 5,156).
“As time marched on, both the UK and the mortgage market started to get back to business, and the Bank of England base rate eventually rose from its record low of 0.10% to 0.25% in December 2021. Several base rate increases followed as inflation started to rise at a worrying pace, but no-one was prepared for market turmoil soon to come. During the latter part of 2022, product choice saw another damaging monthly fall, of 1,632 deals between September and October 2022, which came as the fiscal announcement, or ‘mini-Budget’, was delivered on 23 September 2022. Six months later, choice breached 5,000 deals and the number of deals at 95% loan-to-value breached 200. The market today for borrowers with limited deposits has improved, and despite the end of Stamp Duty Land Tax relief last month, lenders have been working hard to entice new business, with some even offering cashback in the thousands to support buyers. Affordability remains a key issue for buyers, so saving for a large deposit can still feel like an uphill struggle, so choosing the right savings account is essential.”
