According to the latest Rightmove figures, the average five-year fixed mortgage rate is now 5.38 per cent, down from 6.11 per cent a year ago.
The average two-year fixed mortgage rate is priced at 5.85 per cent, a decrease from 6.31 per cent a year ago.
At 60 per cent loan to value (LTV), the average two-year fixed rate is 5.37 per cent with the lowest rate at 5.09 per cent. This compares to 6.14 per cent a year ago.
The average five-year fixed is 4.95 per cent and the bottom-most rate was 4.64 per cent. Last year, the average rate was 5.81 per cent.
Within the 75 per cent LTV tier, the average two-year fixed rate is 5.6 per cent and the smallest rate is 5.14 per cent. The average rate this time last year was 6.16 per cent.
The average five-year fixed rate is priced at 5.19 per cent and the lowest rate was 4.74 per cent. The bottom-most rate is 5.95 per cent.
At 85 per cent LTV, the average two-year fixed rate is six per cent and the bottom-most rate is 5.54 per cent. The average rate in the same period last year is 6.33 per cent.
The average five-year fixed rate currently stands at 5.47 per cent and the lowest rate is five per cent. The average rate a year ago was 6.1 per cent.
The upper LTV tiers dropping
Going up to the higher LTV tiers, at 90 per cent LTV the average two and five-year fixed rate came to 6.13 per cent and 5.56 per cent. The lowest rates were pegged at 5.7 and 5.15 per cent respectively, and compared to last year the average rate was 6.46 per cent for a two-year fixed rate and 6.26 per cent for a five-year fixed rate.
At 95 per cent LTV, the average two-year fixed rate is 6.26 per cent and five-year fixed rate is 5.78 per cent. The lowest rates were 5.99 per cent and 5.62 per cent apiece.
The average rates a year ago were 6.6 per cent and 6.41 per cent.
The average monthly mortgage payment on a first-time buyer type property is currently £224,263, for someone taking out an average five-year fixed, 85 per cent LTV mortgage, is now £1,167 per month if repaying over 25 years, compared with £1,242 per month a year ago.
Rightmove’s mortgage expert Matt Smith said: “Last week’s inflation numbers have not had any material impact on rates, and they’ve continued to slowly creep downwards. It could be just a matter of days before we start seeing sub-five per cent rates in the higher LTV brackets, which would be a first since June and could help to spark a new wave of home-mover confidence.
“The market is still expecting base rates to be held next week, so we’re likely to see mortgage rates continue to trend downwards in the coming week.”
He continued: “As attention turns to next month’s Autumn Statement, the rumoured mortgage guarantee scheme renewal would be some support for those small-deposit movers. Anything that can help those with smaller deposits is always welcome, but we know the vast majority of borrowers opt for a lower LTV mortgage if they can, to avoid higher monthly payments.
“Whilst cancelling the scheme may be seen as a disappointing outcome by some, in reality it is unlikely to have a significant impact on consumer choice, as many lenders are offering five per cent deposit deals outside of the government scheme.”
