The choice of mortgage products on the market has grown to more than double the level seen in the aftermath of the mini-budget last autumn, according to a financial information website. Moneyfacts counted 5,264 options available in May 2023, marking the highest total since February 2022, when 5,356 mortgage products were on the market.
Back in October last year, 2,258 deals were available. Many mortgage products had been pulled from sale, amid market turmoil. Moneyfacts said the number of options within the 15% and 25% deposit ranges are the highest on its records, suggesting a greater stability in the level of choice.
It counted 947 deals for people with a 25% deposit and 816 for people with a 15% deposit, in May. Both figures are the highest on Moneyfacts' records going back to 2007.
The average ‘shelf life’ of a mortgage product, before it is withdrawn from sale, is now 25 days, compared with 15 days in October 2022. Average two and five-year fixed mortgage rates fell between the start of April and the start of May, to 5.26% and 4.97% respectively.
The average two-year tracker variable mortgage rate rose month-on-month to stand at 5.07%. Bank of England base rate hikes have been pushing up costs for some borrowers. The average standard variable rate (SVR) mortgage has continued to climb. At 7.37% typically, this rate is at its highest level since December 2007 (7.47%), Moneyfacts said.
Rachel Springall, a finance expert at Moneyfacts, said: "As was widely anticipated, variable rates continued to rise, but fixed mortgage rates rest lower on a month-on-month basis. Promising as these signs may be, it is anticipated fixed interest rates will start to rise due to volatile swap rates (which lenders use to price mortgages), and for the eighth month running, the average five-year fixed mortgage rate rests lower than the two-year equivalent.
"Borrowers who are coming off a fixed-rate deal may be understandably concerned about the rate difference between their existing rate and those on offer in the present market. In May 2021, the average two-year fixed mortgage rate stood at 2.57%, it is now more than double that."
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