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Average mortgage rates creep up as lenders react to ‘higher-than-anticipated inflation’– Rightmove
Mortgage rates have increased by up to 0.14 per cent at certain loan to value tiers in the past week as lenders repriced due to higher-than-expected inflation figures.
According to Rightmove figures, the largest increases were at 95 per cent loan to value (LTV), with its average two-year fixed rate has increased by 0.14 per cent to 5.74 per cent and the average five-year fixed rate has gone up by 0.12 per cent to 5.27 per cent.
This was followed by the average two-year fixed rate at 60 per cent LTV which rose by 0.09 per cent to 4.73 per cent and the five-year fixed rate has gone up by 0.1 per cent to 4.38 per cent.
At 75 per cent LTV, the average two-year fixed rate has ticked up by 0.05 per cent to 4.79 per cent and the average five-year fixed rate has increased by 0.02 per cent to 4.43 per cent.
The average two-year fixed rate at 85 per cent LTV went up by 0.01 per cent to 4.91 per cent, whilst the average five-year fixed rate at the same LTV tier has decreased slightly to 0.01 per cent to 4.55 per cent.
At 90 per cent LTV, the average two-year fixed rate fell by 0.02 per cent to 5.11 per cent and the average five-year fixed rate decreased by 0.03 per cent to 4.76 per cent.
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Rightmove’s mortgage expert Matt Smith said that in the past week, average mortgage rates had crept up across most fixed rate products as “lenders react to higher-than-anticipated inflation figures”.
He continued that there had been a withdrawal of some mortgage products from the market and those two factors could be “understandably concerning to those thinking of taking out a mortgage soon”.
Smith noted: “If we dig beneath the headlines, the majority of the products withdrawn so far are from smaller lenders with higher rate products in the 90 per cent and 85 per cent LTV brackets, with not much further movement from bigger lenders yet following the end of last week.
“This is why the average mortgage rate has actually edged downwards in some of the smaller deposit products compared to last week.”
He added: “It will likely take some weeks for the full effect of the latest inflation figures to impact the mortgage market, and we will get a better sense of the direction of travel when there is more movement from bigger lenders.”