The average shelf-life of a mortgage has dropped to 16 days, down from 36 days the previous month.  This is according to a Moneyfacts UK Mortgage Trends Treasury Report which also reveals month-on-month the average two- and five-year fixed mortgage rates fell by their biggest margins in almost six months.

Average mortgage rates on the overall two- and five-year fixed rates fell by 0.13% and 0.10% to 5.39% and 5.22% respectively. The drops to the two- and five-year average rates month-on-month were the biggest cuts since the start of October 2024 (0.16% and 0.13% respectively).

At the start of March 2024, the average five-year fixed rate was 5.34%; compared to the start of this month, the rate is 0.12% lower at 5.22%. However, the average two-year fixed rate has fallen by 0.37% over the same period, down from 5.76% to 5.39%.

The average two-year fixed rate is 0.17% higher than the five-year equivalent but the gap is at its lowest margin since January 2023 (0.16%). The two-year fixed rate has now been higher than the five-year equivalent since October 2022.

Product choice overall rose month-on-month, to 6,684 options. Product numbers are up year-on-year (6,004) and are at their highest number since February 2008 (6,760).

The average two-year tracker variable mortgage rate fell to 5.18% and the average ‘revert to’ rate or Standard Variable Rate (SVR) fell to 7.68%. In comparison, the highest recorded was 8.19% during November and December 2023.

Commenting on the data Moneyfacts finance expert Rachel Springall said: “The rate cutting momentum was prevalent during February, with the average two- and five-year fixed rates seeing their biggest cuts in almost six months. Such fierce competition in the aftermath of a typically subdued time of year, showed a mix of moves, but it led to the average shelf-life of a mortgage plummeting to 16 days at the start of March, down from 36 days at the start of February.”

She added:  “The churn of ranges and rate moves circulated around swap rate volatility, but also due to a drop to the Bank of England base rate near the start of the month. Lenders typically act within a couple of weeks of any fierce rises or falls to swap rates. However, it is uncertain whether the rate cutting sentiment will be sustained in the weeks to come, particularly by significant margins, but the millions of borrowers due to come off a cheap fixed deal will be hoping for further falls, without doubt.”