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Best UK residential mortgage rates this week

Michael Brown

Content Writer
Published: 25/05/2022

Last updated: 25th May 2022

Cumberland BS increases its rates, but still holds its market-leading positions.

Our latest data found buy-to-let mortgage rates are on the rise, and a similar story can be told in the residential sector.

Over the past seven days, average two, three, five and ten year mortgages in this sector have increased. Of these categories, two and five year rates saw the biggest percentage point rise of 0.04%, according to our data.

In fact, the best two and five year rates on our remortgage and homeowner charts, which are all held by Cumberland BS, have all hiked. Below, we have discussed these changes, among other market-leading low rates, you can consider when looking for your best mortgage option.

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BTL product choice remains strong but rates are rising

Prospective landlords or those with a buy-to-let (BTL) mortgage set to mature this year may be interested to see our latest data, which highlights sustained levels of product availability in the sector, but warns that interest rates are rising.

There was a small month-on-month dip in the number of products available to landlords, reducing by 61 to leave 3,374 deals on offer at the start of May. Compared to this time last year though, there are over 1,000 more BTL products available now (May 2021 – 2,302), and availability remains notably above that recorded pre-pandemic (March 2020 – 2,897).

Rising for a third consecutive month to 3.41%, the average overall two-year fixed BTL rate is at the highest level recorded since September 2015 (3.41%). This is 0.51% above where this rate stood at the start of December 2021 (2.90%), prior to any of the four recent base rate increases.

Meanwhile, the average overall five-year fixed rate has also increased for a third month in row and sits at 3.56%. This is the highest since March 2019 (3.58%) and represents a rise of 0.38% compared to December 2021 (3.18%). Landlords with a maturing five-year fixed rate from 2017 may therefore be able to secure a more competitive deal as this rate remains 0.12% lower than where it sat in May 2017 (3.68%).

Interestingly, for what is traditionally viewed as a higher-risk area of the sector, landlords will find the level of choice at 85% loan-to-value (LTV) of 79 products is only one deal fewer than the 80 recorded last month – which was the highest number recorded since May 2008 (104). Also, the average two- and five-year fixed rates for landlords with 15% deposits or equity are the only LTV bracket where rates are lower now (4.80% and 4.93%) than they were at the start of December 2021 (5.17% and 5.22%).

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Average two-year fixed rate breaches 3% for first time in over seven years

As the cost of living crisis continues to dominate headlines, data from the latest Moneyfacts UK Mortgage Trends Treasury Report shows that average mortgage rates continue to increase, with the average overall two-year fixed rate rising above 3% for the first time in over seven years.

Despite no base rate movement during April, we saw a 0.17% month-on-month increase in the two-year fixed rate average for all loan-to-values (LTVs) which has now risen for a seventh consecutive month. At 3.03% this is the highest on Moneyfacts’ records since March 2015 (3.06%) and has risen by 0.69% since December 2021.

At 3.17%, the overall five-year fixed rate increased for a seventh consecutive month, rising by 0.16% since last month and now the highest recorded since May 2016 (3.17%), having gone up by 0.53% since December 2021.

Moreover, the average two- and five-year fixed rates at 95% LTV have also risen month-on-month to 3.35% and 3.47% respectively. Not only are these average rates still lower than a year ago, but product availability in this sector has also continued to improve, rising by a further two deals this month to 369 – the most on offer since pre-pandemic in March 2020 (391).

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BREAKING: Bank of England increases base rate to 1%

The Bank of England has today increased base rate by 0.25%, up from 0.75% to 1.00%. We have analysed the average rates offered across savings and mortgages and considers what this decision may mean for consumers moving forward.

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First-time buyers to delay house purchases due to rising cost of living

Nationwide’s study found 28% of respondents believed financing a deposit to be the biggest obstacle to homeownership.

Seven in ten potential first-time buyers, who were looking to purchase their property in the next 12 to 24 months, will now delay their plans due to the growing cost of living.

This is according to research released by Nationwide BS today, which surveyed more than 2,000 people who are looking to buy their first home within the next five years.

In addition to this, 28% of the survey’s respondents felt that saving for a deposit was the biggest obstacle to owning a home. In comparison, concerns over borrowing enough and keeping up with mortgage payments was the next biggest challenge for potential homeowners.

“Building a deposit remains the single biggest barrier to homeownership today, with many people starting out facing a long uphill battle to save. The rising cost of living has made this even harder,” said Paul Archer, Senior Mortgage Manager at Nationwide Building Society.

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Recent News

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Seven surprising impacts on the value of your home

26th April 2022

Most of us know that the value of a home is affected by its size, location, and condition, but there are some more unexpected factors at play too. From the quality of your nearest drinking hole to the toys strewn on your child’s bedroom floor, there are a few things that can have a surprisingly big impact on your home’s selling price.

Most of us know that the value of a home is affected by its size, location, and condition, but there are some more unexpected factors at play too.

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Properties selling at double the speed of 2019

25th April 2022

UK properties are selling at twice the rate of the normal market in 2019 according to real estate company Rightmove. In addition, in March a seller could expect to spend an average of 33 days before their house was sold, 18 days fewer compared to exactly one year prior. This can be attributed to the increased demand for housing but limited supply, which have also driven house prices in an upward trajectory.

UK properties are selling at twice the rate of the normal market in 2019 according to real estate company Rightmove.

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Loan rates fall as demand for home improvements rise

25th April 2022

Borrowers looking to make home improvements will find the average cost of an unsecured personal loan has fallen year-on-year, according to the latest research. In particular, loan rates have fallen on small sums – on a borrowing amount of £3,000 over a three-year repayment period, the average loan rate is down from 14.6% a year ago to 14.3% today. A recent survey from Direct Line revealed 50% of consumers they surveyed wanted to renovate to gain extra space. Loft conversions can be a popular way to maximise living space, and insulation can cost £2,750, according to research by estate and letting agents Barrows and Forrester.

Borrowers looking to make home improvements will find the average cost of an unsecured personal loan has fallen year-on-year, according to the latest research.

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Number of remortgages falls for March, but LMS expect this to be temporary

13th April 2022

Lower remortgage activity last month can be attributed to fewer remortgage products on the market. Compared to February’s figures, the number of remortgages in March fell 28%, according to the latest LMS Monthly Remortgage Snapshot. However, lenders and borrowers can expect this statistic to be a temporary observation due to a drop in product availability.

Lower remortgage activity last month can be attributed to fewer remortgage products on the market.

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Most Popular Mortgage News

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Best UK residential mortgage rates this week

25th May 2022

Each week the moneyfacts.co.uk content team round up the very best mortgage rates available in the UK. Compare and apply today.

Each week the moneyfacts.co.uk content team round up the very best mortgage rates available in the UK. Compare and apply today.

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Two and five year mortgage rates hit historic lows

11th May 2020

Although the number of mortgage deals have almost halved since March, the average mortgage rates on two and five-year fixed deals have hit historic lows

Although the number of mortgage deals have almost halved since March, the average mortgage rates on two and five-year fixed deals have hit historic lows

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Best lifetime mortgage equity release rates this month

13th April 2022

Statistics recently released by the Equity Release Council announcing fourth quarter and full year figures highlight the popularity of Equity Release products. During 2021, 76,154 customers took out new plans, made use of existing drawdown reserves or agreed extensions to existing plans.

Statistics recently released by the Equity Release Council announcing fourth quarter and full year figures highlight the popularity of Equity Release products.

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BTL product choice remains strong but rates are rising

23rd May 2022

Prospective landlords or those with a buy-to-let (BTL) mortgage set to mature this year may be interested to see the latest data from Moneyfacts.co.uk, which highlights sustained levels of product availability in the sector, but warns that interest rates are rising.

Prospective landlords or those with a BTL mortgage set to mature are warned of sustained levels of product availability and rising interest rates

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