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Relief for borrowers as mortgage rates fall for the first time in more than a fortnight
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Mortgage rates have fallen for the first time in more than a fortnight, as a small reprieve for borrowers reeling from market chaos.
The cost of a five-year fixed-rate mortgage fell to 6.28 percent yesterday, according to Moneyfacts, after hitting a 14-year high of 6.32 percent on Wednesday. A year ago it was just above 2 percent.
Rates for two-year deals remained at 6.46 percent, the highest since August 2008.
The cost of a five-year fixed-rate mortgage fell to 6.28% according to Moneyfacts, after hitting a 14-year high of 6.32% on Wednesday. A year ago they were just above 2%
But it came as the Bank of England warned that lenders were planning to cut their mortgage supply, anticipating an increase in the number of households that would struggle to pay them back.
The credit conditions survey, which tracks banks’ expectations for their mortgage loans in the last three months of the year, fell to minus 41.
If these predictions are correct, it would be the weakest period for mortgages outside of the first Covid lockdown since the 2008 credit crisis.
Debt markets have been confused by Chancellor Kwasi Kwarteng’s mini-Budget.
The cost of living crisis is also eating into household budgets.