Several major banks have reduced their mortgage rates following a period of increasing costs related to the recent conflict in Iran.
HSBC will implement rate cuts on its residential and buy-to-let mortgages starting Friday, with the specifics to be unveiled upon the launch.
On the same day, TSB is also lowering rates, particularly on its two-year fixed house purchase mortgages by up to 0.45%. However, some other TSB mortgage rates will see increases, including product transfer deals and additional borrowing options.
Halifax has announced upcoming reductions in fixed rates for home mover and first-time buyer mortgages by up to 0.35% starting Friday.
Santander took the lead by reducing certain mortgage products by up to 0.28% on Thursday, marking the first significant rate cut by a major lender since the onset of the Middle East conflict.
This move by Santander comes in response to a decrease in borrowing costs due to a decline in swap rates, which are instrumental in loan pricing by lenders.
The latest figures from Moneyfacts indicate a minor decrease in average two-year fixed mortgage rates on Thursday, dropping to 5.88% from 5.89% the day before. Meanwhile, the average five-year fixed rate remained stable at 5.77%.
At the beginning of March, the average two-year fixed-rate mortgage stood at 4.83%, while the average five-year fixed-rate deal was at 4.95%.
Concerns over potential inflation spikes resulting from the Iran conflict have led to the recent uptick in mortgage rates, with expectations for the Bank of England to maintain high interest rates for an extended period.
Moneyfacts reported a total of 6,665 homeowner mortgage products available on Thursday, suggesting that rates may have reached a temporary standstill.
Adam French, the head of consumer finance at Moneyfacts, noted that average mortgage rates have stabilized since Easter, indicating a pause in the upward trend. The number of available mortgage deals has been gradually increasing, with 809 products returning to the market since hitting a low point on March 24.
Despite some recent rate cuts by lenders like Santander, Atom Bank, and Skipton Building Society, the mortgage pricing landscape remains susceptible to sudden changes, driven largely by market expectations. Uncertainty in the Middle East and concerns over potential economic impacts continue to pose challenges for borrowers seeking cheaper borrowing options.