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Fixed mortgage rates fall as shelf-life slips to record low

Nick Cheek
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Nick Cheek

The average shelf life of mortgages has dropped to a record low of 15 days before they are pulled by lenders, analysis reveals. But there is hope for buyers when it comes to rates offered.

The length of time a deal is available is the same level as October 2022 – the lowest ever measured by Moneyfacts.

However, product choice has improved in the last three months with the number of products rising to 3,643 from 2,258.

Average rates have also been falling. A two-year fix now stands at 5.79% – the first time it has been below 6% since October.

And a five-year deal stands at a typical 5.63%.

On the other hand, the average standard variable rate (SVR) continued to rise and now stands at 6.64% – the highest level since November 2008.

The gap between the average two-year fix and SVR has increased by 4.12% over the past two years.

‘Fixed rates will fall further’

Rachel Springall, finance expert at Moneyfacts, said: “Borrowers concerned over interest rates may well be relieved to see both the average two and five-year fixed mortgage rates fell month-on-month, down by 0.22% and 0.17% respectively.

“However, it is clear that both these average rates stand higher compared to a year ago, with notable rises during the tail end of 2022 in a time of unprecedented uncertainty surrounding interest rates.”

She added: “As existing mortgage holders weigh up their refinancing plans and others debate their home purchase desires in 2023, it is imperative they seek independent financial advice to go through the options available to them.

“The cost-of-living crisis and inflated interest rates over recent months may well impact borrowers’ intentions of getting a new deal. However, it is anticipated that fixed interest rates will fall further in the months to come to entice new business.”