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Lender confidence boost sees more sub-four per cent mortgages on offer – Rightmove

  • 04/04/2023
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Lender confidence boost sees more sub-four per cent mortgages on offer – Rightmove
Confidence in the market has resulted in lenders reducing more mortgage rates and introducing a wider selection of sub-four per cent deals.

According to Rightmove’s weekly mortgage trends data, the average rate for a two-year fixed rate at 60 per cent loan to value (LTV) with a £999 fee is 4.52 per cent, down from 4.65 per cent as of last week on 28 March. 

The average rate for a five-year fixed rate at the same tier is 4.18 per cent, compared to 4.28 per cent last week. 

These represent rate cuts of 0.13 per cent and 0.1 per cent respectively. 

The average two-year fixed rate at 75 per cent LTV is 4.65 per cent, a decrease from 4.71 per cent, while a five-year fixed rate is 4.32 per cent, a fall from 4.35 per cent previously.

At 85 per cent LTV, two-year fixed rates have reduced by 0.08 per cent on average to reach 4.91 per cent, while five-year fixed rates are now 4.53 per cent, down from 4.62 per cent. 

By comparison, most of these products would have had rates of around two per cent this time last year, with the highest average being the five-year fixed rate at 85 per cent LTV which was 2.6 per cent in 2022. 

Mortgages at 90 per cent LTV have also gone down in rate, with the average two-year fixed rate standing at 5.18 per cent, a reduction from 5.22 per cent and the average five-year fixed rate coming to 4.78 per cent, down from 4.84 per cent. 

These are reductions of 0.04 per cent and 0.06 per cent respectively. 

At 95 per cent LTV, a five-year fixed rate at the same tier has an average rate of 5.07 per cent, a decrease from 5.19 per cent. 

In contrast, mortgages fixed for two years at 95 per cent LTV have risen slightly over the last week. Rightmove’s data found that the average two-year fixed rate for people with a five per cent deposit was 5.62 per cent, a 0.02 per cent rise on last week.  


Competing for business 

Matt Smith, mortgage expert at Rightmove, said that the number of lenders cutting rates this week had “gathered pace”, with average rates going down by up to 0.13 per cent.

He continued that more lenders were offering sub-four per cent five-year fixed rate deals.

“This reflects lenders’ increasing confidence in the future direction of rates following the Bank of England base rate announcement. And, perhaps of equal importance, it’s a sign that lenders are actively competing for business from prospective homebuyers.   

“As we go into the Easter break, we can expect that rates will remain flat or even creep down a little in the coming week. In part due to the bank holidays, but also as lenders take stock of the impact of recent repricing activity,” Smith noted. 

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