Mortgage Product Selection Reaches Three-Month High As Autumn Budget Approaches
Mortgage product availability has increased month-on-month for the first time since July 2024, according to data from Moneyfacts.
The figures reveal that homebuyers now have access to 6,645 mortgage options. Aside from July 2024 (6,658) and August 2024 (6,657), this marks the highest number of choices since February 2008, when 6,760 options were available.
Mortgage product availability has surged over the past two years, nearly tripling compared to the 2,258 options available in October 2022.
Meanwhile, the average shelf life of a mortgage product has held steady at 21 days, unchanged from the previous month. According to Moneyfacts, average mortgage rates for both two- and five-year fixed deals have decreased month-on-month, by 0.16% and 0.13%, respectively.
Currently, the average rate for a two-year fixed residential mortgage stands at 5.37%, while the average five-year deal sits at 5.06%.
Rachel Springall, finance expert at Moneyfacts, commented: “These changes reflect lenders' positive efforts to attract new customers, which may become even more urgent as they approach their year-end targets. Last month, declining swap rates prompted lenders to reduce rates, but factors such as the upcoming Budget, inflation concerns, and global influences could lead to pricing uncertainty in the market. Nevertheless, there is still anticipation that the Bank of England's base rate will decrease further before the year ends."
“Fixed-rate pricing has improved in recent months, with both the average two- and five-year fixed rates falling to their lowest levels since May 2023. The market is in a much better position than it was two years ago, following the fiscal announcement in late September 2022, when borrowers faced fewer options and significant mortgage cost increases. Today, there are nearly three times as many products available compared to October 2022.
“With the upcoming Budget and the next base rate decision looming, borrowers should seek independent advice to explore current options. Lenders are likely to monitor the market closely and may react swiftly to any changes. As we've seen before, some deals could be withdrawn as lenders reassess their margins.”