‘Welcome’ boost issued to anybody with a Lloyds, Nationwide, Natwest, HSBC, Santander or Barclays mortgage
Homeowners have been dealt a boost as the average five-year and two-year fixed mortgage rate begins to dip – after a high of 6.04 per cent earlier this week. Across all deposit sizes on the market, the average five-year fixed-rate homeowner mortgage is 6.03 per cent, edging down from 6.04 per cent on Tuesday, Moneyfacts said.
The last time the average five-year fixed deal was below 6 per cent was on July 3, when it stood at 5.97 per cent. The average two-year fixed residential mortgage rate is 6.53 per cent, down from an average rate of 6.54 per cent on Tuesday. Some major mortgage lenders have been cutting rates this week, with the Bank of England base rate being held steady.
Mortgage borrowers with chunkier deposits can choose from five-year fixes at rates below 5 per cent. Matt Smith, a mortgage expert at property website Rightmove, said: “Following the positive news on inflation and the Bank’s decision to hold the base rate, we have seen swap rates, the underlying costs of fixed-rate mortgages, stabilise.
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“The important takeaway from last week for those looking to take out a mortgage soon is that the expectation that the base rate has now peaked is now the predominant view of the market, although there is still a sizeable but decreasing risk that we may see one more increase this winter.”
Mr Smith went on, telling the PA news agency: “As we approach the final quarter of this year, we are likely to see continued stability in the mortgage market persist with rates continuing to gradually drop and more lenders likely to offer sub-5% deals. After what has been a rollercoaster 12 months for mortgage rates since the mini-budget, this will be welcome respite for home movers after what continues to be a difficult adjustment from the prolonged period of ultra-low rates.”
