Average mortgage rates on two and five-year fixed deals rose for the first time in six months between February and March, data from Moneyfacts UK has revealed.
Moneyfacts UK Mortgage Trends Treasury report found the average two-year fixed rose to 5.76 per cent across all LTVs in March of this year.
This was an increase of 0.20 percentage points on the 5.56 per cent recorded in February but remained less than the 6.70 per cent recorded in September when the trend of consecutive cuts began.
Average five-year fixed rate rose to 5.34 per cent in March 2024 from 5.18 per cent in February.
Moneyfacts finance expert, Rachel Springall, said: “As fixed mortgage rates rise, borrowers may wish to wait and see whether these rates will come back down in the weeks to come, but they must keep in mind there is still an incentive to switch away from a SVR.
“All eyes are on the Monetary Policy Committee and their future rate setting, in conjunction with the swap rate market, as to whether mortgage rates will come down this year.
“Borrowers would be wise to seek advice if they are looking for a new deal, particularly as the shelf life of a product remains so unpredictable.”
Products
The research found that the average shelf life of mortgage products decreased over the past month to 15 days.
This represented a large fall from the 28 day average shelf-life recorded in February but was a minor decrease from the 16 days in March 2023.
However, total product count across all LTVs was found to reach 6,004 in March, the highest the count has been for 16 years.
This represented an increase on the 5,787 products recorded in February and was the largest month-on-month rise in the past six months.
Springall added that a deeper dive into the LTV sectors revealed good news for borrowers with limited deposits.
“Product choice at 90 per cent LTV rose b 80 deals month-on-month, now at its highest count in four years.
“Those borrowers with just a 5 per cent deposit will also find a rise in choice, as there are now over 300 deals on the market at 95 per cent loan-to-value, the highest count since June 2022.”
However, she acknowledged that prospective first-time buyers still have affordability challenges to overcome amid volatile house prices and a lack of affordable housing.
tom.dunstan@ft.com
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