Rates jumped across the board, following volatility in the sterling funding market after Chancellor Kwasi Kwarteng’s tax-cutting mini-Budget last Friday, with an average three-year fix jumping by 72 basis points to 5.85%, according to Moneyfacts.
The average 10-year fix lifted by 71 basis points to 5.39%, and an average two-year fix lifted by 43 basis points to 5.17%.
The average five-year fix rose by 26 basis points to 5.10%.
The market for available products has shrunk dramatically over the year and in the last week.
Over the year to the start of this month, the number of products on the market fell by 27% to 3,890 against a series of Bank of England base rate rises. In the last week following the Chancellor’s intervention available products fell a further 41% to 2,273.
Two-year fixes
The most significant changes here last week took place at the 65% LTV average rate, which leapt by 132 basis points to 5.69%, followed by the 85% LTV average rate lifting by 59 basis points to 5.36%.
The 95% LTV average rate increased by 20 basis points to 5.23%, while the 90% LTV average rate rose by 23 basis points to 5.02%.
Three-year fixes
The biggest rise at this level came at the 95% LTV average rate, jumping by 156 basis points to 6.53%, and the 90% LTV average rate lifting by 119 basis points to 6.18%.
The 85% LTV average rate rose by 92 basis points to 6.13%, however, the 70% LTV average rate fell by 120 basis points to 5.07%.
Five-year fixes
The largest rise at this level came at the 65% LTV average rate, rising by 136 basis points to 6.37%, followed by the 50% LTV average rate, which rose by 122 basis points to 5.78%.
The 95% LTV average rate rose by 20 basis points to 6.15, and the 90% LTV average rate was 26 basis points higher at 5.59%.
10-year fixes
The most significant changes here took place at the 50% LTV average rate, which leapt by 135 basis points to 5.79%, followed by the 80% LTV average rate, which rose by 107 basis points to 5.29%.
The 95% LTV average rate lifted by 64 basis points to 6.12%, while the 90% LTV average rate increased by 50 basis points to 5.59%.
Moneyfacts finance expert Eleanor Williams says: “Moneyfacts has processed record levels of mortgage product withdrawals this week, and despite some providers cautiously returning some products to market today, the level of choice available to new borrowers has fallen again this morning.
“There are just 2,273 residential mortgage deals on offer today, which is 1,688 fewer products than were available last Friday (23.9.22). Providers to re-introduce options to their ranges today included Virgin Money, The Mortgage Lender and Bank of Ireland UK (including sister brands), but the predominant trend has been product withdrawals, with this week seeing various lenders temporarily exiting from the market entirely.
“Rate rises are also continuing apace, with some providers increasing initial rates by notable amounts.
“Some of the brands to make significant rate increases to their fixed offerings this week included Metro Bank of up to 2.10%, HSBC of up to 1.86% and Barclays Mortgage of up to 1.20%. The Moneyfacts average overall two-year fixed rate, as of 30 September, sits at 5.17%. When tracked against our first-of-month data, this is the first time this average has exceeded 5% since November 2009 when this was 5.11%.”
