Mortgage lenders start 2024 with a bang
First published on KensingtonHouse.com on 2 February 2024. Figures, forecasts and quotations reflect that date and have not been updated. Read it as a record of the market at the time, not as a current view.
The first month of the new year has seen Halifax, the UK’s biggest lender, cut interest rates by close to a whole percentage point. Interest on their two-year fix was cut by 0.83%, with HSBC swiftly following suit by introducing new deals including a five-year fix at 3.94% and a two-year fix at 4.49%. Leeds Building Society also announced it had “decided to start strong in 2024” by reducing rates across its range of product by up to 0.49%.
“More banks and building societies are likely to improve their rates, fighting it out to offer the cheapest deals”
David Hollingworth, associate director at broker L&C Mortgages, said: “These cuts are just the latest salvo in an increasingly fast-moving market…offering some of the lowest rates since the spike in rates last summer.” Aaron Strutt, product director at Trinity Financial said: “It seems highly likely that more banks and building societies will improve their rates over the coming weeks and fight it out to offer the cheapest deals.”
With buyers now able to access a range of mortgage options at well under 5% and even some below 4% for the first time in several months, their monthly repayment budgets are less stretched and they are able to offer higher prices to secure their next or first home. We expect to see this new mortgage rate landscape exerting upwards pressure on prices over the course of the year.
Original publication: kensingtonhouse.com, 2 February 2024. The organisations quoted are named in the text; their figures are reported as they stood on the publication date.