Last month, Advantage wrote that lenders were pulling a number of mortgages from the market amidst fears of rapidly rising interest rates following the contentious mini-budget. At the time, some analysts were warning that borrowers could face substantially higher mortgage rates for years to come.
However, following a sea change in the government’s economic policy, stability seems to be returning to the mortgage market, with The Times reporting that: “Some of Britain’s biggest lenders including Barclays, HSBC, Santander, TSB, and Coventry, Skipton and Yorkshire building societies have been cutting the cost of some fixed mortgage deals by more than half a percentage point this week.”
According to This Is Money, Natwest and Darlington Building Society are the latest lenders to update their mortgage rates, with Natwest cutting prices by up to 0.6 per cent.
They added: “Darlington Building Society also has re-entered the fixed-rate market with products for new and existing customers.
“The building society is offering a 6.09 per cent five-year fixed rate for those with 10 per cent deposits, costing £1,105 a month for a £170,000 mortgage.
“Existing customers can get a two-year fixed rate at 6.04 per cent with a 40 per cent deposit, costing £776.09 a month on a £120,00 mortgage.”
Chris Brown, products and marketing Director at Darlington Building Society said: “Darlington Building Society is doubling down on its commitment to the mortgage market by reintroducing fixed rate mortgages, after remaining in the market with a range of variable rate options.
“We know that it’s a challenging time for buyers right now, and hope that bringing our fixed rate mortgages back to the market will provide reassurance, and additional choice, for those looking to buy their own home or re-mortgage to the Society.”
Advantage’s view: Following a challenging month for home buyers and mortgage brokers, the current drop in mortgage rates is an encouraging sign that there may be better times ahead. Of course, as some degree of economic stability appears to be returning, many potential buyers will hope that there will be better deals available in the weeks and months to come. And although the Bank of England looks set to raise interest rates again within days, experts believe this is unlikely to push rates back up. As the dust begins to settle after the mini-budget, potential buyers will find themselves with more options than they had in recent weeks.