Hope for homeowners and prospective buyers continued to grow today as First Direct and TSB were among the latest lenders cutting rates, while Halifax announced reductions for more of its mortgages.
Prices have tumbled to start the year, amid increasing expectations that the Bank of England should soon be in position to cut its interest rates.
Today, First Direct became the latest lender to offer some five-year fixed-rate mortgages with interest rates below 4%, joining HSBC and Generation H. Meanwhile, TSB cut a number of its two-year fixes.
Craig Fish, director at Docklands-based Lodestone Mortgages & Protection, said of the TSB cuts: “This is more good news for the consumer, with a particular focus now being seen on the shorter-term 2 year fixed rates as the most popular product choice by far at the moment. Also good to see an emphasis on remortgages and higher LTV levels too. Whilst it won't send TSB to the top of the rate charts, all in all, this is a good round of reductions from another big lender.”
Stephen Perkins, managing director of broker Yellow Brick Mortgages, said more cuts are likely to come: “The gloves are off. Lenders are now duking it out daily in a serious rate bout, all trying to land scoring punches. On the back of Halifax and HSBC's reductions, TSB is now making its move to continue to carve out its share of a pent-up market.
“This should get more and more explosive as we move through the rounds.”
Halifax also announced reductions for more of its products, after slashing rates on many mortgages on Monday.
It comes as the number of mortgage approvals rose again in November, data released by the Bank of England shows.
Approvals remain near 15-year lows, but are likely to continue rising as the market reacts to lower mortgage rates.
New data from Moneyfacts today shows a sharp fall in average interest rates offered by lenders. The average five-year fixed-rate deal fell below 5.5% for the first time since February 2023, falling from 5.53% to 5.46%.
