MARKET WATCH!

UK Mortgage Rates: A Quick Look at the Last Week (as of March 24th, 2024)

This week in the UK mortgage market (as of March 24, 2024), we’ve seen a relative pause after several weeks of steady increases in interest rates. The Bank of England (BoE) held its base rate at 5.25% for the first time since August 2023, which might offer a glimmer of hope for potential borrowers.

Here’s a breakdown of the current mortgage landscape:

• Average Rates: According to Rightmove, the average rate for a five-year fixed-rate mortgage remains steady at 4.85%, unchanged from last week. The average two-year fixed-rate mortgage also held its ground at 5.23%.
• Lowest Rates Available: There’s still some movement in the best deals available. While the lowest five-year fixed rate remains at 4.13%, some lenders might be offering slightly better deals compared to last week.
• Best Two-Year Fixed Rates: As of today, some lenders are offering competitive two-year fixed rates as low as 4.13%. This could be a good option if you prioritize stability for the next two years and are comfortable with a potential rate increase later.
• Competitive Five-Year Fixed Rates: Looking for longer-term stability? The best five-year fixed rates are currently hovering around 4.42%. This provides peace of mind knowing your repayments won’t change for the next five years.

Tips for Homebuyers:

Shop Around: Don’t settle for the first rate you see. Use mortgage comparison websites and consult with different lenders to find the best deal for your circumstances.

Consider Fees: While the headline interest rate is important, factor in additional fees like arrangement fees and valuation charges when comparing offers.

Stay Informed: Market conditions can change quickly. Keep an eye on financial news and mortgage rate updates to make informed decisions.

Consider the lender: Larger more well known lenders, tend to be more consistent with their products. They also tend to have quicker and easier processes for switching to a cheaper rate should they come down after you have applied. Opting for the absolutely cheapest deal, if with a small lender, could likely result in you having to apply from scratch with another lender, should rates come down between application and completion. This is hard to weigh up and quantify, but from recent experience is something which has impacted borrowers who used a small building society for their mortgage, simply because they offered a good rate for a brief period, but new rates thereafter were not.

Looking for More Information?

Here are some resources to help you with your mortgage research:

Rightmove: https://www.rightmove.co.uk/news/articles/property-news/current-uk-mortgage-rates/

MoneyWeek: https://moneyweek.com/personal-finance/mortgages

Moneyfacts: https://moneyfactscompare.co.uk/mortgages/

Remember: This blog post provides a general overview. It’s always best to consult with a mortgage broker to discuss your specific situation and needs when making mortgage decisions.