Mortgage rate activity remained weak this week, as fixed rate cuts outpaced increases but had little impact on average mortgage rates, according to Moneyfacts.
Moneyfacts finance expert Rachel Springall said the summer holiday period and bank holiday period were likely to contribute to the quieter level of lender re-pricing.
The average two-year fixed mortgage rate decreased by 0.01 percentage point on a weekly basis, from 5.60% to 5.59%, while the average five-year fixed rate remained unchanged at 5.63%.
Despite the recent moves, both rates remain higher than their levels at the beginning of July, when two- and five-year fixes averaged 5.52%. However, they are slightly lower than the levels recorded at the beginning of August, when they reached 5.63% and 5.66%, respectively.
Swap rates have remained broadly between 30-day highs and lows, creating uncertainty about the future direction of fixed mortgage pricing, Springall said.
“The interest rate cuts seen by lenders this week are encouraging; however, average mortgage interest rates are generally higher than they were at the beginning of July,” she said.
The quieter pace of repricing may not last next week as lenders return to normal trading after the summer holiday period.
Noticeable price changes this week
- Bank of Ireland Brokers – Selected fixed prices reduced by up to 10 bps.
- Bank of Ireland in the United Kingdom – Selected fixed prices reduced by up to 10 bps.
- Halifax – Selected fixed prices reduced by up to 13 bits per second Via intermediaries 11 bits per second Via direct business.
- Leeds Building Society – Selected fixed prices reduced by up to 19 bits per secondwith additional income rates reduced by up to 10 bps.
- Lloyds Bank – Fixed prices for purchasing a specific home reduced by up to 11 bits per second.
- Suffolk Building Society – Selected fixed prices reduced by up to 10 bps.
- Telecommunication Standardization Bureau – Selected fixed prices reduced by up to 20 bps.
- Vida Homeloans – Selected fixed prices reduced by up to 20 bpsWhile others increased by 5 bits per second.
- General H – The fixed rate specified for New Build Boost has been increased by 5 bits per second.
- Hodge – Fixed RIO rates increased by up to 40 bits per second.
Track and monitor variable discounted price changes
- Earl Shelton Building Society – Increase variable mortgage rates by 25 bits per second.
- Suffolk Building Society – Reduce variable mortgage rates by up to 14 bits per second.
