According to Rightmove, since mortgage rates peaked in July, the average five-year fixed mortgage rate has reduced from 6.11 per cent to 5.07 per cent, while the average two-year mortgage rate has reduced from 6.61 per cent to 5.48 per cent.
Low to mid-tier LTVs
At 60 per cent loan to value (LTV), the average two-year fixed rate is 4.86 per cent, with the lowest coming to 4.65 per cent.
The average five-year fixed rate is priced at 4.46 per cent, the bottom-most pegged at 4.29 per cent.
Going up to 75 per cent LTV, the average two-year fixed rate is 5.31 per cent with the lowest coming to 4.7 per cent.
The average five-year fixed rate is 4.99 per cent, and the cheapest rate stood at 4.41 per cent.
Higher LTVs
Within 85 per cent LTV, the average two-year fixed rate is 5.61 per cent and the bottom-most rate is 5.05 per cent. The average five-year fixed rate is 5.16 per cent, with the lowest rate coming to 4.62 per cent.
At 90 per cent LTV, the average two-year fixed rate is 5.76 per cent and the cheapest rate stands at 5.29 per cent.
The average five-year fixed rate is 5.22 per cent and the bottom-most rate is 4.79 per cent.
Going up to 95 per cent LTV, the average two-year fixed rate is 5.9 per cent and the lowest rate is 5.72 per cent.
The average five-year fixed rate is 5.48 per cent and the cheapest rate comes to 5.24 per cent.
The average monthly mortgage payment on a typical first-time buyer type property when taking out an average five-year fixed rate at 85 per cent LTV, is now £1,111 per month, down from £1,139 per month a year ago.
Mortgage rates dependent on base rate decision tomorrow
Matt Smith, Rightmove’s mortgage expert, said: “No news is often good news when it comes to the mortgage market, and yet another week – the 20th in a row – of marginal percentage point drops is positive news for home-movers.
“Swap rates have also remained steady this week but fell further on the back of the UK GDP data published today: a good indicator that the markets are confident about how tomorrow’s base rate announcement will play out.”
He continued: “After the chunky drop in inflation was announced in mid-November, it looked even more likely that tomorrow will bring a third consecutive base rate hold. And while these pauses come off the back of falling inflation and a more positive economic outlook, the Bank has indicated that we’re unlikely to see any Base Rate drops until we’re well into 2024.
“However, markets are currently forecasting that the first base rate reduction may arrive in late Spring next year.”
Smith said: “A hold tomorrow could provide some room for lenders to offer further mortgage rate drops – though it’s likely that lenders may hold back offering these to borrowers this side of Christmas, to take advantage of the seasonal jump in demand that usually happens in January.”
