"Whilst there have been twists and turns, home buyers are coming to terms that rates won't be returning to the previous ultra-low levels any time soon."
Average mortgage rates have fallen for the tenth consecutive week, with rates at lower LTVs now cheaper than they were twelve months ago, according to the latest Rightmove figures.
At 60% LTV, two and five-year rates are both lower than they were a year ago. The average two-year fix is now 5.61%, down from 5.71% in October last year, while the average five-year fix is down from 5.24% last year to 5.07%.
In addition, the average 75% LTV five-year fix is 1bps lower than last year at 5.31%.
Across all LTVs, the average two-year fixed rate mortgage is 6.01%, up from 5.70% a year ago, while the average five-year fix remains 18bps higher than last year at 5.50%.
The average monthly mortgage payment on a typical first-time buyer type property when taking out an average five-year fix at 85% LTV is now £1,185 per month, up from £1,123 per month a year ago.
Rightmove’s mortgage expert, Matt Smith, commented: “It’s now the tenth week that average rates of dropped, as the slow but steady downward trend of fixed mortgage rates continues. As more lenders begin to offer sub-5% rates, this is likely to demonstrate increasing confidence that swap rates, the underlying costs of fixed rate mortgages, will remain stable for lenders, meaning there may be more room for rates to fall, particularly for those with a smaller deposit.
“We’re starting to see more attractive rates in some LTV brackets than a year ago as we begin to compare rates with the post mini-Budget period, though this doesn’t take away the fact that mortgage costs are still much higher than most have been used to. Whilst there have been twists and turns, home buyers are coming to terms that rates won't be returning to the previous ultra-low levels any time soon. However, this continued stability can at least give the many people still looking to move more certainty about what they can afford, and the type of mortgage offer they might expect.”
