"It is encouraging to see that potential new homeowners now have a greater number of mortgage options available at the higher LTV tiers, as well as lower initial interest rates"
Its data shows that 95% LTV two-year fixed rates have fallen from 4.15% this time last year to a record low of 3.54% this month.
This significant fall of 0.61% is despite the Bank of England increasing the base rate by 0.25% in August this year.
In comparison, the average two-year fixed mortgage rate at up to 60% LTV has increased by 0.12% year-on-year, up to 70% LTV by 0.26%, 75% LTV by 0.25% and max 85% LTV has risen by 0.21%.
Additionally, the number of fixed mortgage deals available at a maximum of 90% LTV has increased by 101 products during the past 12 months to reach a record high of 656. The number of fixed mortgage deals available at max 95% LTV stands at 304 this month, four products less than the record of 308 available in August this year.
Darren Cook, finance expert at Moneyfacts, said: “With first-time buyers being the essential lifeblood of the housing and mortgage market, it is encouraging to see that potential new homeowners now have a greater number of mortgage options available at the higher LTV tiers, as well as lower initial interest rates in the two-year fixed sector, to choose from.
“The higher LTV market looks to be showing healthy competition between providers as they vie for first-time buyers’ attention, however this seems to be moving in a completely different direction to the tiers that call on much larger deposits or require a greater portion of equity.
“Prospective first-time buyers should start to consider their options and make a comparison of mortgage products that may best suit their requirements, as choosing a good deal could save significant sums in the long run.”
