The average interest rate for a two-year and five-year rate mortgages has fallen to a new low since records began in 2007, according to Moneyfacts. The average two-year deal is now 2.09%, while the average five-year deal is 2.35%.

With the recent emergency Bank of England base rate cuts to 0.1% in response to the Coronavirus Pandemic, lenders have passed on the reduction to borrowers. 

Banks and Building Societies, have also had to review their lending criteria, due to the level of risk they are taking, in light of the impact the virus is having on the UK’s economy. As a result, lenders have reduced the number of products they are offering for those with a high loan-to-value (LTV).

With the current mortgage deals in place, this is an excellent time to re-mortgage, especially for those with mortgage products coming to an end and those who are on a standard variable rate (SVR) which is currently around 4.5%.

On an average fixed rate deal of 2.09% on a £200,000 mortgage, means that homeowners could save more than £3,135 a year if they switch to these new rates. The gap between a two-year and five-year fixed rate deals have also narrowed, meaning that those who wish to lock an attractive interest for a longer period, won’t have to pay a higher interest rate as before.

Lenders have also cut the overall mortgage products available in the market from 5,222 to just 2,566 on March 20th. Although this offers far few products on the market, it also simplifies product choice for homeowners, who have more competitive rates to choose from. 

With an attractive mortgage rate, homebuyers will be able to purchase their home with a lower monthly payment than before. We do expect the property market to pick up in Leicester, due to it's central location and being a prime spot in the UK's property market over the last two years. 

If you are looking to buy a property or were thinking about this before the lockdown, now is a great time to consider buying a new home with the current cheap mortgage deals out there. 

We are also seeing more instructions coming to the market after the lockdown, and with the summer months coming up, we are hoping that the property market will pick up. 

 

Whether you are looking to Buy, Sell or Let, speak with a property expert today by calling us on 0116 275 8888!