The average five-year fixed mortgage rate in the UK has fallen below 6 percent

Oct 3, 2023

The average five-year fixed mortgage rate in the UK has fallen below 6% for the first time since early July, according to Moneyfacts.

This is good news for homeowners looking to move and also for prospective buyers, who have faced rising mortgage rates and inflation uncertainty in recent months. The average five-year fixed rate peaked at over 6% in July, but is finally decreasing to more reasonable levels.

There’s a number of reasons for this drop:

The Bank of England kept the base rate unchanged last week, giving lenders more confidence to cut their own rates.
Inflation may be starting to peak. The Office for National Statistics (ONS) announced last week that inflation fell to 6.7% in the year to August 2023, from 7% in the year to July.
Increased competition among lenders. As lenders are keen to attract new customers and retain existing ones, they are starting to offer more competitive mortgage rates.

The average five-year fixed mortgage rate is now 5.99%, but there are also a number of deals available at below 5%, particularly for borrowers with larger deposits!

For example, HSBC is offering a five-year fixed-rate mortgage at 4.93% to borrowers with a 40% deposit and NatWest is offering a similar deal at 4.95%.

This is a welcome relief for homeowners and prospective buyers during a ‘cost of living crisis’, and means that monthly mortgage payments will be lower and that more people will be able to afford to buy a home.

Mortgage rates can still fluctuate though, so it is important to compare deals and choose the one that is right for you.

If you are thinking about getting a mortgage, now is a good time to do it. Mortgage rates are at their lowest level in several months, and there are a number of competitive deals available.

Get in contact with us or book an initial consultation to see how we can help you secure a mortgage.

Steven Morris – Advising Director

CeMAP CeRER

Steve loves a complex mortgage. Most recently he has used his technical geekery to work his way up through Which? Mortgage Advisers, progressing to Senior Adviser and then Onboarding Manager. There, he was responsible for hiring, training and managing new advisers.

He also ran the monthly new starter inductions and wrote and maintained the telephony advice standards of the company. Outside of work Steve can be found coaching and being run ragged by his local under 10’s rugby team, Bristol Harlequins RFC.

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