Mortgage Sale as lenders slash rates and fees
August’s base rate rise, Bank of England governor Mark Carney’s warnings of a potential property price plunge and general anxiety still lingering around Brexit, you could be forgiven for feeling negative about the current state of the property market.
But a quick look at the numbers will show there’s hardly ever been a better time to be hunting for a mortgage – whether you’re a first-time buyer, remortgaging, or looking to get into buy-to-let – rates have scarcely ever been lower. Not only are rates dropping, lenders are also expanding their product ranges into areas that they previously might not have considered.
Mortgage rates fall across the board for both first-time buyers and remortgagors in Wolverhampton
Bluestone, a specialist lender available through mortgage brokers, has also just introduced a Help to Buy product range for first-time buyers looking to get on the ladder, with rates starting at 3.79 per cent with £1,000 cash back. Help to Buy launched in April 2013 offering borrowers an equity loan equal to up to 20 per cent of the value of the property interest-free for five years.
Mortgage rates for those with just 5 per cent equity or deposit are at their lowest level since records began. The average two-year fixed rate has actually fallen from 3.95 per cent last year to stand at around 3.73 per cent today, according to Moneyfacts.
First-time buyers can now find small deposit mortgages at incredibly competitive rates It’s not just first-time buyers feeling the benefits of a competitive market. Elsewhere, mortgage rates are continuing to fall despite August’s base rate rise.
Remortgage rates are also cheap
Research from Moneyfacts suggests that average two-year fixed rates have now dipped below 2.5 per cent, with deals available for as little as 1.39 per cent – only 0.64 per cent over the base rate, which is more competitive than most tracker and variable mortgages. Two months on from the rate hike in August, the average two-year fixed rate has actually fallen from 2.52 per cent to stand at 2.49 per cent today. Five-year fixed rates have also fallen by 0.02 per cent over the same period. Data from Moneyfacts also shows the average two-year fixed mortgage rate has risen by just 0.28 per cent from their all-time low last year, in contrast to the full 0.50 per cent base rate increase since October 2017.
The past year has been a challenging time for providers as they have had to wrestle with two base rate rises for the first time in years, while at the same time needing to remain competitive to protect their mortgage book. ‘This conflict of interest has meant average fixed mortgage rates haven’t followed the Bank of England’s rate rises entirely.’
Kensington Mortgages, another broker-only lender, this week launched a 10-year residential fixed rate at both 60 and 75 per cent LTV, with rates starting from 4.34 per cent. The average two-year fixed rate has fallen from 2.52 per cent in August to 2.49 per cent today
The average two-year fixed rate has fallen from 2.52 per cent in August to 2.49 per cent today
Buy-to-let is cheaper than ever as landlords exit the market
Bank of England rates data shows the average buy-to-let mortgage rate at 75 per cent loan-to-value has also plummeted to just 2.27 per cent – the lowest since records began in 2012.