Average mortgage rates in the 70% loan-to-value tier saw the steepest reductions this week, analysis from Moneyfacts shows.
While there was not much movement in the overall averages for two, three and five-year fixed rates, borrowers with a 30% deposit or equity were the biggest winners from lenders’ latest round of repricing.
Average three-year fixed rates at 70% LTV dropped by 5bps to 5.11% and average five-year fixed rates fell by the same margin to 4.98%.
The average two-year fixed rate at 70% LTV edged down by 2bps to 4.88%, according to Moneyfacts‘ weekly data.
Looking at the overall averages across all LTV tiers, three-year fixed rates moved down 2bps to 4.86%, while two and five-year fixed rates both dropped by a basis point to 4.97% and 5.02% respectively.
Most other changes within individual LTV tiers were movements downwards by a single basis point, apart from three-year fixes at 90% LTV and five-year fixes at 60% LTV which both reduced by 2bps.
Santander’s move to reduced rates by up to 36bps does not take effect until Monday so will be reflected in next week’s averages.
Moneyfactscompare.co.uk finance expert Rachel Springall says: “There were a few prominent brands to make fixed rate tweaks, with Barclays cutting by up to 10bps, as did HSBC by the same 10bps margin. TSB, on the other hand, increased by 10bps.
“Out of the few building societies to make fixed rate moves this week, Nottingham Building Society cut by up to 18bps, West Brom Building Society cut by up to 24bps, and Yorkshire Building Society made cuts of up to 8bps but also increased selected rates by 5bps.
“Progressive Building Society increased by up to 10bps and Leeds Building Society made minor rate tweaks, with increases of up to 5bps. In addition, Loughborough Building Society launched a new deal for borrowers at 95% loan-to-value.”
Among the specialist and intermediary-only lenders, Accord Mortgages cut by up to 16bps, April cut by up to 15bps, Gen H cut by up to 25bps and Precise cut by up to 15bps but also increased selected rates by 11bps.
Swap rates signal room for further cuts
Springall adds: “Swap rates have been hovering around their 30-day lows, which in turn, could spell further rate reductions in the coming days.
“It seems unlikely for the Bank of England to cut base rate in November, but this should not deter borrowers.
“Some buyers may feel a little in limbo until after the November Budget, with the rumour mill spinning changes to property tax and a cap on gifting.
“Limiting the gifting allowance would be a huge blow for borrowers who need to turn to the ‘Bank of Mum and Dad’ to build a big enough deposit to secure a mortgage in the coming months.”
