Race for the best mortgage deals is on with home buyers facing rates of more than 6 per cent
The race for the best mortgage deals has begun with homebuyers facing rates above 6 percent as lenders react to market turmoil
- Average interest rates on home loans skyrocketed to levels not seen since the start of the year
Homebuyers struggling to scrape together a down payment are faced with mortgage rates exceeding 6 percent.
Average interest rates on home loans have risen to levels not seen since the start of the year, new figures show, as lenders respond to more market turmoil.
Anyone looking for a contract with a fixed interest rate for two years, but has only saved 5 percent on their home, will have to pay an average of 6.01 percent.
For all two-year deals, no matter how large the down payment, rates average above 5 percent. Many are rushing to secure deals before rates rise again.
In either case, things haven’t been so bad since January, when the market was still reeling from Kwasi Kwarteng’s fall mini-Budget.
Homebuyers looking for a two-year, fixed-rate mortgage deal, but have only saved 5 percent on their home, have to pay an average rate of 6.01 percent
Many people are rushing to secure deals before rates rise again
After the release of worse-than-expected inflation data last month, market volatility flared up again.
Traders are anticipating an increase in the Bank of England’s key interest rate to 5.5 percent by the end of this year.
This affects the interest rates that lenders use to price mortgages, leading to interest rate increases on those loans.
Figures compiled by real estate website Rightmove showed that home loan rates rose by an average of 0.39 percent over the past week.
Rightmove’s Matt Smith said: ‘This is a much higher increase than we’ve seen in recent weeks and reflects the uncertainty among lenders at the moment.’