Mortgage competition hits highest level since financial crisis
Lenders brought a massive 244 mortgage products to the market in June, taking overall numbers from 4,791 to 5,035 in July, according to analysis by Moneyfacts.
This time last year there were 4,604 mortgages available, while before the financial crisis hit in March 2008 there were 6,192 deals on the market.
Borrowers with small deposits have been among those to benefit from wider availability, with the number of 90% loan to value (LTV) products now at 624 – the highest on Moneyfacts’ records.
No change to rates
However, the extra products being added to the market today have not impacted rates on offer, according to Charlotte Nelson from Moneyfacts.
She said: “Unusually, the extra products on the market seem to have had little to no effect on average rates, with the average two-year fixed rate remaining unchanged at 2.52% this month.
“This suggests providers are currently trying to compete for mortgage business in other ways besides rate.
“Instead, they are opting to perhaps offer fee-free deals and products with incentive packages, which have in turn boosted product numbers.”
Nelson noted that lenders had already made a lot of rate adjustments as they geared up for what seemed a certain base rate rise in May.
“Although the Bank of England did not increase its base rate, providers have chosen to keep their higher rates, opting to be more cautious and wait and see whether an imminent base rate rise is likely,” she added.
- First-time buyer numbers fall 22% as rates rise and housing availability bites
- Experts predict an end to Bank of England base rate hikes
- Half a million homeowners face festive fixed rate mortgage crisis
- Mortgage war continues as rates fall below 5%: Barclays, Virgin Money, HSBC, The Mortgage Works and YBS slash prices