Major price cuts by lenders moved the average mortgage rates on two, three and five-year fixed rates down by 3 basis points this week.
The latest rate watch data from Moneyfacts show that the average mortgage rate for two-year fixes is now 4.92%, for three-year fixes it is now 4.84% and for five-year fixes it is now 4.98%.
Among the categories to see the steepest falls were average five-year fixed rates at 50% loan-to-value, which dropped by 7bps.
Two-year fixed rates at 50%, 60% and 75% LTV all fell by 6bps.
Three-year fixes at 60% and 65% LTV came down by 5bps, as did two-year fixes at 75% LTV.
There was also some good news for borrowers with small deposits as the average five-year fixed rate at 90% LTV reduced by 4bps.
Lots of other product categories saw average rates dip by between 1 and 3bps.
The overall average mortgage rate also reduced below 5% to 4.98%.
Lenders that cut rates this week included Virgin Money by up to 33bps, TSB by up to 15bps, Royal Bank of Scotland and NatWest by 9bps, Lloyds Bank by 9bps, and Halifax, which made two cuts this week to selected fixed rates — first by 20bps, then by 9bps.
Santander also cut selected rates by up to 10bps.
Building societies that made price cuts included West Brom by up to 18bps, Coventry by 25bps, Leeds by 20bps, Principality by up to 13bps, Nationwide by 25bps, Melton by up to 20bps, Furness by up to 9bps, Family by up to 15bps and Newcastle Building Society by up to 20bps.
Other notable rate reductions included April Mortgages, Clydesdale Bank and LendInvest, which reduced fixed rates by up to 11bps, 30bps and 15bps respectively.
Moneyfactscompare.co.uk spokesperson Caitlyn Eastell says: “Activity in the mortgage market has ramped up this week, with some big lenders making reductions by notable margins but building societies were most active.
“Only two lenders have moved to increase rates this week.”
Eastell adds: “As inflation remains sticky, it’s not wholly unsurprising that the Bank of England voted to hold base rate at 4%.
“However, we are seeing many lenders reducing their fixed rate offerings as they are more closely linked to swap rates, which are currently sitting around their 30-day lows.
“This could be especially encouraging for borrowers coming off a shorter-term deal as they could see their monthly repayments drop significantly.
