Average two- and five-year fixed rates have fallen at a faster rate this week as the market prepares for a possible base rate cut.
According to the latest Rightmove figures, the average five-year fixed mortgage rate is set at 4.88%, down from 6.08% a year ago.
The average two-year fixed mortgage rate is priced at 5.27%, a decrease from 6.6% a year ago.
Last week, the average five-year fixed mortgage rate was 4.95% and the average two-year fixed mortgage rate was 5.34%.
At 60% loan to value (LTV), the average two-year fixed rate is 4.62%, with the lowest rate pegged at 4.46%. The average rate a year ago was 6.34%.
The average five-year fixed rate at this LTV tier is 4.21% and the cheapest rate is 4.04%. The average rate was 5.83% this time last year.
Going up to 75% LTV, the average two-year fixed rate is priced at 5.11% and the bottom-most rate is 4.69%. The average rate a year ago was 6.42%.
The average five-year fixed rate at 75% LTV is 4.76% and the cheapest rate is 4.14%. The average pricing a year ago was 5.94%.
Within the 85% LTV tier, the average two-year fixed rate is 5.28% and the lowest rate is 4.87%. The average rate a year ago was pegged at 6.64%.
On the five-year fixed rate side, the average price is 4.92% and the bottom-most rate is 4.49%. The average rate a year ago was 6.12%.
Going up to 90% LTV, the average two-year fixed rate is 5.59% and the cheapest rate is 5.54%. The average rate a year ago was 6.94%.
The average five-year fixed rate is 5.13% and the lowest rate is 4.75%. The average pricing in the same period last year was 6.21%.
At 95% LTV, the average two-year fixed rate is 5.96% and the lowest rate is 5.54%. The average rate a year ago was 6.94%.
A five-year fixed rate is 5.48% on average and the bottom-most rate is 5.23%. The average price a year ago was 6.29%.
The average monthly mortgage payment on a typical first-time buyer type of property when taking out an average five-year fixed 85% LTV mortgage is £1,124 per month, down from £1,249 per month a year ago.
Matt Smith, Rightmove’s mortgage expert, said: “We’ve seen average mortgage rates drop at a pace not seen for a while this week, faster than many expected as lender competition hots up.
“The first sub-4% rate for those with larger deposits and prepared to pay a higher fee is the headline-grabber, but we’ve also seen some notable drops in rates in other LTV brackets, which should benefit more mass-market movers.
“It’s interesting to see this competition for business increase even before the base rate decision, and though there’s still only around a 50% chance the base rate will be cut next week, if the current positive market sentiment continues, we could see further mortgage rate cuts.”
Anna is currently the deputy editor for Mortgage Solutions and editor for Specialist Lending Solutions. She has worked as a journalist since 2019, having secured her Gold Standard NCTJ diploma from News Associates in a fast-track six-month course.
She started her career as a report at specialist publication The Insurance Insider covering a wide range of areas before joining Mortgage Solutions and Specialist Lending Solutions in 2021.
In her role, she helps put together and structure the news agenda for the day and writes up press releases, reports, interviews, analyses and exclusives across both titles. She also commissions blogs for Specialist Lending Solutions and hosts online masterclasses and in-person events across the business.
She has been shortlisted for three journalism awards, which include BIBA Journalist and Media Awards Scoop of Year Award in 2020, Headline Money Mortgage Journalist of the Year Award (B2B) in 2022 and 2023.
Prior to being a journalist, Anna worked in ecommerce across Snow + Rock, Cycle Surgery and Runners Need websites, and before that worked at specialist financial PR firm Rostrum.
In her spare time, Anna enjoys reading, seeing live music, and cooking for friends and family. When she gets a chance, she also enjoys hiking, skiing and indoor rock climbing.
