Product choice fell to 6,842 options, however, choice is up year-on-year (6,657 – August 2024).

The average shelf-life of a mortgage product rose to 17 days, from 16 days a month ago; a year ago it was 17 days, and two years ago, it was just 13 days.

Average mortgage rates on the overall two- and five-year fixed rates fell by 0.08% and 0.07% to 5.01% and 5.01%, respectively, slightly higher margins than the prior month.

You have to go back to September 2022 and May 2023 when two- and five-year fixed rates were lower (4.24%) and (4.97%) respectively. These were the last times the rates were at sub-5%.

At the start of August 2024, the average five-year fixed rate was 5.38%; at the start of August 2025, the rate was 0.37% lower at 5.01%. However, the average two-year fixed rate has fallen by 0.76% over the same period, down from 5.77% to 5.01%.

The Moneyfacts Average Mortgage Rate fell to 5.04%, down from 5.11% month-on-month. It is down from 5.65% since August 2024, and lower than 6.52% in August 2023.

The average two-year tracker variable mortgage rate remained unchanged at 4.91%.

The average ‘revert to’ rate or Standard Variable Rate (SVR) remained at 7.42%. In comparison, the highest recorded was 8.19% during November and December 2023.

Commenting on the latest data Moneyfacts finance expert Rachel Springall said that lenders had mixed attitudes to pricing during the month, and the churn of products resulted in a dip in choice, cancelling out the previous month’s rise. “In spite of the perhaps cautious approach, rate cuts prevailed to push the Moneyfacts Average Mortgage Rate down to 5.04% at the start of this month, edging ever so closer to dipping below 5%.”

Base rate moves

“As it stands, lenders may well consider a more low and slow approach to making cuts over the next few weeks, because of the knife-edge base rate decision last week which led to a rise in swap rates.

“Piling onto this, the markets could react badly to any significant decisions made in the Autumn Budget, an event which can be a blessing or a curse for future rate setting. If inflation gets out of control or economic uncertainties spike, borrowers can forget about more base rate cuts by the Bank of England this year.”

Springall pointed out that it has now been two years since the average two-year fixed mortgage rate hit a 15-year high, as lenders frantically repriced their deals the average shelf-life of a mortgage was just 13 days.

“Lenders are still churning their ranges today, albeit with a shelf-life of 17 days, but such repricing is to the benefit of borrowers. The incentive to refinance today onto a fixed deal is much more critical, as there is now a significant difference of more than 2% to escape a revert rate, compared to just 1% back in August 2023, based on the average two-year fixed rate versus the average Standard Variable Rate (SVR).”

Springall added that the big difference to first-time buyers and those borrowing at higher LTVs as the year progresses will be the changes to the loan-to-income (LTI) rules.