The average two-year fixed rate mortgage has fallen for the first time in 12 months, despite the base rate increasing in August.
The average two-year rate dropped from 2.53 per cent in September to 2.49 per cent in October, according to data released by Moneyfacts.
Moneyfacts reported the latest drop of 0.04 per cent was found to be the first fall since October 2017 when the average rate sat at 2.2 per cent.
Charlotte Nelson, finance expert at Moneyfacts, said the fall marks the first reduction to the average mortgage rate since both the November 2017 and August 2018 base rate increase.
Ms Nelson said: "Many would have assumed that the average rate would have increased in the aftermath of the base rate rise this August, however the opposite seems to be the case.
"Providers have started to reignite competition in the market to attract remortgage customers and retain their mortgage books."
Ms Nelson said with the average standard variable rate increasing for a second month - reaching 4.89 per cent in October - the motivation to remortgage among borrowers is growing, and it is these customers providers are vying to attract.
She said: "This is not only seen by the decrease in average rate, but also the increasing number of lower loan-to-value (LTV) products.
"Previously, the number of deals had stagnated for those with lower LTVs, with competition reserved for more niche areas. However, as competition between providers has intensified, the number of deals in this area has subsequently increased."
Ms Nelson added: "Borrowers know only too well that low rates will not be around forever, so anyone on an standard variable rate or approaching the end of their deal would be wise to shop around and take advantage of the current competition in the market."
Rachel Lummis, mortgage adviser at Xpress Mortgages, said the fall of the average price of a two-year fixed rate is good news for borrowers but does not come as a surprise.
She said: "Following the base rate rise in August many clients asked, as they always do, if this means that all the fixed rates available from the lenders would now increase.
"The answer is always the same and that is no, lenders are constantly changing their rates, pulling entire product ranges, relaunching new offerings and its does not take a change in the bank base rate to prompt that."
Ms Lummis said there are many different factors as to why lenders increase and decrease rates on their products.
She said: "If a lender has the appetite for lending on a particular product range and has a pot of money they need to lend then they will price competitively to win the business, we often see at this time of year certain lenders launching new ranges and re launching week after week to win their market share before the year end.