Since May 2023, the average rate on a five -year fixed mortgage has been reduced by 5% for the first time, as the cost of credit continues to fall.
According to the Financial Information Service Moneyfacts, the average five -year fixed rate was 4.99% on Thursday, 5% to 4.99% on Thursday.
Although the percentage drop can only be equal to a small financial savings, it can indicate a change in market spirit, in which moneyfacts describe such moments as “symbolic bend points”.
Even the smallest rate drop can promote buyer’s confidence and compete more among lenders.
Meanwhile, the average two-year fixed rate hostage, Which fell below 5% last week Former Prime Minister Liz Trus’s mini budget in September 2022 fell on Thursday for the first time.
It fell from 4.98% to 4.97% on the previous day.
Adam French, head of the news at Moneyfacts, stated that the latest data was “more welcome news for the borrowers” and said it was shown that the lenders were “more aggressively competing”.
Commenting on the decline of a five -year mortgage rate, Mr. French said: “The slow and steady decline in borrowing costs compared to last year has jointly helped promote the ability for several home owners and homebuilders with strong average income increase.”
However, he feels that reading the latest inflation of 3.8% has effectively prevented the possibility of looking at another base rate cut in 2025.
“As a result, some minor mortgage rate reductions are the best borrower, perhaps expecting in the short term because the lenders adjust the possibility of high rates longer,” Mr. French said.
Lenders are also providing more options, with 7,031 residential mortgage products available, above the previous working day above 6,992.
This year hundreds of thousands of borrowers are again due to hostage.
Britain’s Finance, Banking Industry Group, said that the 900,000 fixed rate deals are due to the end in the second half of 2025.
The mortgage rates are still higher than the years before the mini budget.
The fiscal incident carried forward the cost of borrowing of the UK government, which was fed at hostage rates. By July 2023, the borrowing cost of the mortgage was increased The highest level since the 2008 financial crisis,
