Interest rates for homeowners are “unlikely” to return to the low levels seen over the past ten years, according to Lloyds Bank chief executive Charlie Nunn, who told BBC’s Laura Kuenssberg he expected mortgage rates to come down, but not to the near-zero rates seen were during the 2010s.

Asked if ‘cheap; mortgage deals were ever going to return, Nunn replied: “We do think they [mortgage rates] are going to continue to come down, but getting back to the level we saw in the last decade where interest rates were down at zero I think is unlikely.”

The Bank of England base interest rate, is currently 5%  and this  rate was held at its current level last month, with the MPC insisting inflation had to show a continued downward trajectory before rates would come down further.

Nunn said while there were many parts of the UK “continuing to struggle” due to the cost of living, 2024 had marked “the turn that we have seen in terms of most people in the country feeling more financially secure”.

“For most people it has got a lot better. There is more savings in deposit accounts, there’s less people struggling with loans and actually business confidence is at a nine-year high.”

Nunn’s view that mortgage rates would not return to ultra-low levels was broadly shared at the recent Mortgage Business Expo 2024. Talking at a seminar on the challenges facing residential mortgages, The Mortgage Lender distribution director Sarah Palmer said 3.5% was now very much the “new normal” and delegates in the room strongly agreed with one delegate pointing out that we are pretty much at that point now with some products – and that is without a further cut in Bank base rates.

Even if MPC cuts rates a little further – the 3.5% mark was largely viewed as the level at which lenders would stick.