Average mortgage rates drop marginally as market steadies
There were small declines in average mortgage rates compared to last week as the property market showed signs of settling, data from a property portal found.
Across all mortgage tiers, the Rightmove weekly mortgage tracker showed that rates were falling this week, despite the rise in the base rate last Thursday.
The average rate for a two-year fixed mortgage at 60% loan to value (LTV) was 6.24%, down from 6.3% as of 1 August. A five-year fix at the same tier had an average rate of 5.77%, down from 5.82% last week.
At 75% LTV, the average two-year fixed rate is 6.42%, slightly lower than 6.47%a week ago. The five-year fixed alternative is priced at 5.98%, the same as the average last week.
For a deal at 85% LTV, a two-year fix is priced at 6.61%, while a five-year fix is 6.14%. These were small drops from 6.65% and 6.15% respectively.
A two-year fix at 90% LTV had a rate of 6.74% on average, which was down from 6.77% last week. For a five-year fix at the same tier, the average rate had fallen from 6.18% to 6.16%.
At 95% LTV, the average rate for a two-year fix was 6.94%, unchanged from the previous week.
Meanwhile, the average five-year fixed rate for small deposit borrowers decreased from 6.26% to 6.24%.
Hope for a period of stability
Matt Smith, mortgage expert at Rightmove, said: “The market has remained relatively calm since the base rate increase, and those looking to take out a mortgage soon will be hoping this period of some stability continues for as long as possible.
“As expected, despite the base rate rise, fixed rate mortgage deals have continued to tentatively trend downwards and based on the latest swap rates, are likely to continue to do so slowly, barring any market surprises.
“A settled market provides more confidence and certainty, and next week’s inflation data will be key to setting the tone for the following weeks. If some positive news means confidence can continue to build, lenders may feel they can get more competitive with their rates to attract the many motivated buyers still in the market to move.”