Another major high street bank, Barclays, has recently announced a reduction in its mortgage rates, although data reveals that the market average has crept up over the past month. Despite the overall increase in the market average, Barclays is taking steps to offer more competitive rates to homebuyers and homeowners. The move signals a shift within the sector, as financial institutions adjust their offerings in response to changing economic conditions.
Starting from 10 December, Barclays will be lowering a number of its fixed-rate deals by up to 0.14 percentage points. This follows a similar decision made by NatWest, which also cut mortgage rates by up to 0.39 percentage points last week. The two banks are part of a growing trend among high street lenders to adapt their mortgage products to attract more customers, particularly as the market continues to evolve and the economy fluctuates.
For prospective homebuyers, Barclays’ cheapest five-year fixed-rate mortgage will now be available at 4.11%. However, this rate will only apply to those able to provide a deposit of at least 40%. This requirement reflects the bank’s strategy to offer lower rates to buyers with a higher level of financial security. For homeowners looking to remortgage, the bank is charging a slightly higher rate of 4.12%, though this is still relatively competitive compared to other offers on the market.
In addition to these changes, Barclays is also introducing a 4.22% five-year fixed-rate mortgage for those purchasing a property with a 25% deposit. This adjustment comes at a time when many homebuyers are seeking more predictable mortgage payments, especially with the current economic uncertainty and the ongoing fluctuations in the property market. It’s clear that Barclays is making an effort to cater to a range of buyers, from first-time homebuyers to those looking to remortgage.
While these reductions are welcome news for those looking to secure a fixed-rate mortgage, it’s important to note that the overall market conditions continue to be affected by broader economic factors. With mortgage rates generally still higher than in previous years, homeowners and buyers alike are advised to shop around for the best deals and consider consulting with a whole-of-market broker. As the mortgage landscape continues to change, having the right advice and information is crucial for making the best financial decisions.
Another major high street bank, Barclays, has recently announced a reduction in its mortgage rates, although data reveals that the market average has crept up over the past month. Despite the overall increase in the market average, Barclays is taking steps to offer more competitive rates to homebuyers and homeowners. The move signals a shift within the sector, as financial institutions adjust their offerings in response to changing economic conditions.
Starting from 10 December, Barclays will be lowering a number of its fixed-rate deals by up to 0.14 percentage points. This follows a similar decision made by NatWest, which also cut mortgage rates by up to 0.39 percentage points last week. The two banks are part of a growing trend among high street lenders to adapt their mortgage products to attract more customers, particularly as the market continues to evolve and the economy fluctuates.
For prospective homebuyers, Barclays’ cheapest five-year fixed-rate mortgage will now be available at 4.11%. However, this rate will only apply to those able to provide a deposit of at least 40%. This requirement reflects the bank’s strategy to offer lower rates to buyers with a higher level of financial security. For homeowners looking to remortgage, the bank is charging a slightly higher rate of 4.12%, though this is still relatively competitive compared to other offers on the market.
In addition to these changes, Barclays is also introducing a 4.22% five-year fixed-rate mortgage for those purchasing a property with a 25% deposit. This adjustment comes at a time when many homebuyers are seeking more predictable mortgage payments, especially with the current economic uncertainty and the ongoing fluctuations in the property market. It’s clear that Barclays is making an effort to cater to a range of buyers, from first-time homebuyers to those looking to remortgage.
While these reductions are welcome news for those looking to secure a fixed-rate mortgage, it’s important to note that the overall market conditions continue to be affected by broader economic factors. With mortgage rates generally still higher than in previous years, homeowners and buyers alike are advised to shop around for the best deals and consider consulting with a whole-of-market broker. As the mortgage landscape continues to change, having the right advice and information is crucial for making the best financial decisions.
Average fixed mortgage rates rise
While the cheapest mortgage rates are beginning to edge down, the average rate across the entire market has been on the rise, according to data from rates monitor Moneyfacts. Over the past month, the average rates on both two- and five-year fixed mortgages have increased by 0.13 and 0.19 percentage points, reaching 5.52% and 5.28% respectively.
This uptick in rates marks the biggest monthly rise in the five-year fixed-rate average since August 2023. The increase reflects how lenders have had to adjust their products in response to the ongoing volatility in the financial markets.
Rachel Springall, a finance expert at Moneyfacts, explained that this rise in rates has been influenced by the shifting market conditions. “This month, the average five-year fixed rate saw a notable increase, and throughout 2024, this rate has not fallen as much as its two-year counterpart,” she said.
This news is likely to be disappointing for borrowers who had been hoping to lock in a long-term deal at a lower rate. Springall also highlighted the fact that many borrowers have not yet re-fixed their mortgages since rates started rising back in 2021, stressing the importance of seeking professional advice.
For example, borrowers who secured a five-year fixed-rate deal back in 2019 would have been paying an average of 2.74%. Now, with the average rate having nearly doubled, homeowners are facing much higher repayments, with the rate now sitting at 5.28%. While there is hope that mortgage rates will decrease next year, any potential rate cuts may be delayed by persistent inflation, and much depends on the actions of the Bank of England.
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