Mortgage rates are continuing to decrease, albeit at a slower pace, according to the latest mortgage news and rate watch data from Moneyfacts, a leading provider of mortgage comparisons and mortgage rates.
Over the past week, the average two-year fixed rate has fallen by 2bps to 4.82%, while the average five-year fixed rate has decreased by 1bps to 4.90%. Additionally, the Moneyfacts Average Mortgage rate has dropped from 4.90% to 4.88%, indicating a slight decrease in mortgage interest rates.
This week’s mortgage market trends follow a similar pattern to last week’s, with rate cuts slowing down as lenders adopt a more cautious approach to mortgage rate changes.
The most significant reductions were seen in three-year fixed-rate mortgages with a 95% loan-to-value (LTV) ratio, which decreased by 7bps to an average of 5.29%. Similarly, three-year fixes with a 90% LTV ratio saw cuts of 5bps, resulting in an average rate of 4.82%.
In contrast, two-year fixed-rate mortgages with a 60% LTV ratio experienced a 1bps increase, rising to an average of 4.28%. A 1bps rise was also recorded for five-year fixes with a 60% LTV ratio, with the average rate now standing at 4.56%.
According to Moneyfacts products expert Caitlyn Eastell, “Lenders have been gradually introducing fixed-rate reductions over the past couple of weeks, but as we approach Christmas, mortgage rate movements have slowed down substantially, with only four lenders making changes to their rates and a handful more withdrawing or adding to their product ranges.”
“This week’s cuts included notable reductions from Aldermore, with decreases of up to 45bps, and Vida Homeloans, with cuts of up to 32bps. Barclays Mortgage was the only major lender to make changes, reducing selected fixed rates by 20bps and increasing a few ‘premier’ accounts by 10bps.”
This week also saw Kent Reliance withdraw its entire mortgage range as the brand exited the market. The leading fixed rate is still held by Santander, but the rate has decreased to 3.51% for two-year fixed-rate mortgages.
