The average two-year fixed rate has seen the biggest reduction, falling by 0.24% since January this year.
Five- and ten-year fixed rates have also seen significant reductions since January, however, with 5-year rates sitting at an average of 3.29% in January, down to 3.10%, and 10-year fix average rates down to 3.43% from 3.63% in January.
Charlotte Nelson, Finance Expert at Moneyfacts.co.uk, said:
“With competition still fierce in the market it is little surprise that mortgage rates have fallen in the first half of 2016, reaching record lows yet again and currently showing no signs of stopping. Borrowers looking for a new mortgage deal today will be substantially better off than they were six months ago. In fact, anyone considering a five-year fixed rate mortgage today would save themselves £240* a year compared to January.
“Long-term fixed rates have benefited from the recent plummet in SWAP rates, and it isn’t only the more acceptable five-year fixed rates that have fallen. The 10 -year fixed rate sector has seen a boon in the number of products available, increasing from 80 in January to 127 today, and the average rate falling by 0.20% in the same period.
“Borrowers with smaller deposit have not been left out either, with the average two-year fixed rate at 95% loan-to-value (LTV) falling by 0.19% from January 2016 to 4.09% today. However, with the Help to Buy Mortgage Guarantee scheme ending in December this year, it begs the question of how long this can be sustained for.
“While the economy may have faced some uncertainty after the EU referendum one thing is for certain: mortgage competition is currently here to stay, and borrowers sitting on the Standard Variable Rate or coming to the end of their mortgage deal would be wise to consider a fixed rate deal now, when they are still at record lows.”
