Mortgage product choice rebounds

Mortgage approvals

Product choice overall rose month-on-month, to 6,645 options, the first rise since July 2024

Mortgage product choice rose month-on-month after dropping in the two previous months, and the average shelf-life of a mortgage remained unchanged, reveals the latest Moneyfacts UK Mortgage Trends Treasury report.

Product choice overall rose month-on-month, to 6,645 options, the first rise since July 2024. With exception of July 2024 (6,658) and August 2024 (6,657), this is the highest count since February 2008 (6,760). Product numbers have also risen substantially over the last two years, with nearly treble the products available now (6,645) when compared to October 2022 (2,258).

The average shelf-life of a mortgage product stayed at 21 days as a month prior.

Average mortgage rates on the overall two- and five-year fixed rate deals dropped month-on-month by 0.16% and 0.13% respectively.

The overall average two- and five-year fixed rates dropped between the start of September and the start of October, to 5.40% and 5.07% respectively. These rates are now at their lowest level since May 2023. The average two-year fixed rate is 0.33% higher than the five-year equivalent. The two-year fixed rate has now been higher than the five-year equivalent since October 2022.

The average two-year tracker variable mortgage dropped slightly to 5.67%.

The average ‘revert to’ rate or Standard Variable Rate (SVR) declined to 7.96%. In comparison, the highest logged was 8.19% during November and December 2023.

Rachel Springall, finance commentator at Moneyfacts, said: Mortgage product choice rebounded after two months of declines, which is an encouraging sign for the market. Lenders continued to lower fixed mortgage rates but there was a much calmer rotation of products, as the average shelf-life of a mortgage remained at 21 days. These moves show the promising attitude of lenders to draw in new customers, which may be even more pressing as we edge closer to any of their end of year targets.

Last month falling swap rates encouraged lenders to reduce rates, but a combination of the looming Budget, concerns over inflation and other global influences can result in market pricing uncertainty. However, there are still expectations for the BoE base rate to decline further before the year is over, Springall said.

Disclaimer: The opinions expressed by our writers are their own and do not represent the views of Getting Money Wise. The information provided on Getting Money Wise is intended for informational purposes only. Getting Money Wise is not liable for any financial losses incurred. Conduct your own research by contacting financial experts before making any investment decisions.

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