rate increase

Mortgage rates begin to increase as base rate rise looms

With another base rate rise around the corner, borrowers coming to the end of their term or sitting on a standard variable rate need to act now, while low rates are still available.

Mortgage rates change daily but ahead of an anticipated base rate rise next month, reports are suggesting that the market is on the increase. According to Moneyfacts, the two-year fixed mortgage rate has reached a 19-month high and while this may be due to numerous factors, borrowers seeking a new mortgage are being urged to lock into a low rate while they still can.

Two-year fixed increases by 0.04%

Charlotte Nelson, finance expert at Moneyfacts, reports that the two-year fixed rate average has increased by 0.04% compared to last month, now sitting at 2.43%. She states: “After months of stagnation, March and April’s increases in the average two-year fixed rate have now effectively cancelled out any rate reductions that may have occurred in the last 19 months.”

SWAP rate rise affecting rates too

Lenders are also at the mercy of the increasing SWAP rate, which means that it is getting more expensive for them operate. The SWAP rate is at its highest value since August 2015 at 1.11%, which means many providers are forced to increase mortgage rates.

Withdrawal of 60% LTV products

Moneyfacts also suggest that the fall in the number of 60% LTV products available, to 495, has affected the two-year mortgage rate. In the past few years this has been a booming market for lenders; however, it is likely that in the face of another base rate rise, providers are taking their most popular or riskiest products off the market in anticipation.

Borrowers coming to the end of a deal or sitting on their lender’s standard variable rate now need to move fast if they want to secure a low rate deal. While it seems the two-year fixed rates are on the increase, borrowers could consider choosing a longer fixed term with rates still remaining low by comparison for now.

Self-certified Sophisticated Investor

Please read

I declare that I am a self-certified sophisticated investor for the purposes of the restriction on promotion of non-mainstream pooled investments. I understand that this means:

I am a self-certified sophisticated investor because at least one of the following applies:

I accept that the investments to which the promotions will relate may expose me to a significant risk of losing all of the money or other property invested. I am aware that it is open to me seek advice from someone who specialises in advising on non-mainstream pooled investments.

High Net Worth Investor

Please read

I make this statement so that I can receive promotional communications which are exempt from the restriction on promotion of non-mainstream pooled investments. The exemption relates to certified high net worth investors and I declare that I qualify as such because at least one of the following applies to me:

STAY AHEAD OF THE MARKET

Sign up for first access to new developments and exclusive property investment opportunities.

We send limited and targeted emails on new launches and exclusive deals which best fit your areas. We are trusted by over 30,000 active buyers as their source for new stock.

  • New property developments
  • Professional market reports
  • Property deal alerts
  • Development updates
Manchester property investment

FIRST FOR NEWS AND KNOWLEDGE.

Receive trending news straight to your inbox and stay up to date on all of the property market trends and advice.

Established since 2005 we are a leading voice of authority and commentary on the UK property market. Our news is trusted by Apple News & Google News.

  • UK housing market
  • Mortgage & money
  • Buy-to-let landlords
  • Guides & advice

Talk to us

Speak to our UK property experts today:

 

+44 (0) 333 123 0320

Open from 9am-6pm GMT

 

+852 6699 9008

Open from 9am-6pm HKT