Fixed mortgage average rates at a six month low

Rachel Springall, Press Officer / Finance Expert T: 01603 476210 E: Email Rachel

Fixed mortgage average rates at a six-month low

The latest Moneyfacts UK Mortgage Trends Treasury Report data reveals the overall two-year fixed mortgage rate stands at 0.32% higher than the five-year equivalent. It has been 15 years since the average two-year fixed was priced this far higher. Both rates stand at their lowest levels in six months, after a fourth consecutive month of falls.

Product choice stands at 4,372 options, a subtle rise from 4,341 in February 2023. Within the individual loan-to-value (LTV) tiers, following a rise of 51 to 657, availability within the 60% LTV tier is at its highest level on Moneyfacts records.
Both the average two- and five-year fixed rates fell month-on-month for the fourth month running, down to 5.32% and 5.00% respectively, now both at their lowest levels in six months. The average two-year fixed rate stands at 0.32% higher than the average five-year equivalent. The last time the average two-year fixed rate was this far above the five-year was 15 years ago (February 2008 – 0.36%).
The average ‘revert to’ rate or Standard Variable Rate (SVR) continued to climb. At 7.12%, this rate has breached 7% for the first time since October 2008 and is now the highest rate since April 2008 (7.16%).
The margin between the average two-year fixed rate taken out two years ago (2.57%) and the average ‘revert to’ rate (7.12%) rose to 4.55% in March, the largest margin on Moneyfacts records.

Product choice stands at 4,372 options, a subtle rise from 4,341 in February 2023. Within the individual loan-to-value (LTV) tiers, following a rise of 51 to 657, availability within the 60% LTV tier is at its highest level on Moneyfacts records.
Both the average two- and five-year fixed rates fell month-on-month for the fourth month running, down to 5.32% and 5.00% respectively, now both at their lowest levels in six months. The average two-year fixed rate stands at 0.32% higher than the average five-year equivalent. The last time the average two-year fixed rate was this far above the five-year was 15 years ago (February 2008 – 0.36%).
The average ‘revert to’ rate or Standard Variable Rate (SVR) continued to climb. At 7.12%, this rate has breached 7% for the first time since October 2008 and is now the highest rate since April 2008 (7.16%).
The margin between the average two-year fixed rate taken out two years ago (2.57%) and the average ‘revert to’ rate (7.12%) rose to 4.55% in March, the largest margin on Moneyfacts records.

Mortgage market analysis
		Mar-21	Mar-22	Oct-22	Feb-23	Mar-23
Fixed and variable rate products	Total product count - all LTVs	3,532	4,838	2,258	4,341	4,372
	Product count - 95% LTV	5	342	132	149	161
	Product count - 90% LTV	323	678	295	539	546
	Product count - 60% LTV	504	531	337	606	657
All LTVs	Average two-year fixed rate	2.57%	2.65%	5.43%	5.44%	5.32%
All LTVs	Average five-year fixed rate	2.75%	2.88%	5.23%	5.20%	5.00%
95% LTV	Average two-year fixed rate	3.99%	3.11%	5.54%	5.99%	5.85%
95% LTV	Average five-year fixed rate	3.75%	3.37%	5.49%	5.53%	5.33%
90% LTV	Average two-year fixed rate	3.52%	2.76%	5.33%	5.66%	5.50%
90% LTV	Average five-year fixed rate	3.66%	3.03%	5.12%	5.14%	4.99%
60% LTV	Average two-year fixed rate	1.65%	2.06%	5.08%	5.04%	5.01%
60% LTV	Average five-year fixed rate	1.86%	2.25%	4.94%	4.96%	4.76%
All LTVs	Standard Variable Rate (SVR)	4.41%	4.61%	5.63%	6.84%	7.12%
All LTVs	Average two-year tracker rate	2.24%	2.03%	3.77%	4.39%	4.84%
Data shown is as at the first available day of the month, unless stated otherwise.
Source: Moneyfacts Treasury Reports

Mortgage market analysis
		Mar-21	Mar-22	Oct-22	Feb-23	Mar-23
Fixed and variable rate products	Total product count - all LTVs	3,532	4,838	2,258	4,341	4,372
	Product count - 95% LTV	5	342	132	149	161
	Product count - 90% LTV	323	678	295	539	546
	Product count - 60% LTV	504	531	337	606	657
All LTVs	Average two-year fixed rate	2.57%	2.65%	5.43%	5.44%	5.32%
All LTVs	Average five-year fixed rate	2.75%	2.88%	5.23%	5.20%	5.00%
95% LTV	Average two-year fixed rate	3.99%	3.11%	5.54%	5.99%	5.85%
95% LTV	Average five-year fixed rate	3.75%	3.37%	5.49%	5.53%	5.33%
90% LTV	Average two-year fixed rate	3.52%	2.76%	5.33%	5.66%	5.50%
90% LTV	Average five-year fixed rate	3.66%	3.03%	5.12%	5.14%	4.99%
60% LTV	Average two-year fixed rate	1.65%	2.06%	5.08%	5.04%	5.01%
60% LTV	Average five-year fixed rate	1.86%	2.25%	4.94%	4.96%	4.76%
All LTVs	Standard Variable Rate (SVR)	4.41%	4.61%	5.63%	6.84%	7.12%
All LTVs	Average two-year tracker rate	2.24%	2.03%	3.77%	4.39%	4.84%
Data shown is as at the first available day of the month, unless stated otherwise.
Source: Moneyfacts Treasury Reports

Rachel Springall, Finance Expert at Moneyfacts, said:

“The momentum in the residential mortgage market is positive, as fixed rates fell and product choice stabilised month-on-month. Lenders have continued to reduce fixed rates, with the average five-year fixed rate resting below the equivalent two-year. The average two-year fixed rate stands at 0.32% higher than the average five-year equivalent. The last time the average two-year fixed rate was this far above the five-year was 15 years ago. Rate competition among lenders has been more focused on longer-term fixed mortgages. As the overall two- and five-year fixed average rates drop to their lowest levels in six months, borrowers who put their plans to remortgage on hold towards the tail end of last year may now be looking at the latest offers.

“Prospective borrowers with a limited deposit or equity may be pleased to see fixed rates at higher loan-to-value deals are reducing. The average five-year fixed rate at 90% and 95% loan-to-value fell to 4.99% and 5.33% respectively month-on-month, which is 0.16% and 0.13% lower compared to the start of October 2022. At the other end of the spectrum, in the 60% loan-to-value tier, the average five-year fixed rate has fallen by 0.18% from 4.94% to 4.76% over the same period. Product choice also grew notably overall in the 60% loan-to-value tier month-on-month, following a rise of 51 options to 657, now at its highest level on our records.

“It is positive to see fixed rates falling, but at the same time, variable interest rates are rising significantly. The average Standard Variable Rate (SVR) has now breached 7% for the first time since October 2008, which means borrowers will be in for a shock if they are about to revert from a low fixed rate deal. Indeed, the margin between the average two-year fixed rate taken out two years ago (2.57%) and the average ‘revert to’ rate (7.12%) stands at 4.55% in March, the largest margin on Moneyfacts records. Borrowers must therefore ensure they carefully consider the mortgage options available to them, particularly fixed rates, if they want peace of mind to secure their monthly repayments.”

Rachel Springall, Finance Expert at Moneyfacts, said:

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Notes to editors

Pioneering financial comparison technology for over 35 years.

Our expert research team monitors the thousands of mortgages, savings, credit card, personal loan, business banking, life, pension and investment products in the UK.

Moneyfacts is the UK's leading independent provider of finance product data. For over 35 years Moneyfacts' information has been a key driver behind personal finance product decisions.

For more information about us please see our key facts.

Broadcast

Our broadcast suite enables our finance experts to appear in-vision for television, and we regularly comment live on national and regional radio.

To arrange an interview for radio or television, please contact our press department. We have an in-house broadcast room.

If you're looking for extra comment, a chart or more information, then please give us a call. We are always more than happy to help.

Rachel Springall Press Officer / Finance Expert

T: 01603 476210

E: Email Rachel

Caitlyn Eastell Apprentice Press & PR Assistant

T: 01603 476169

E: Email Caitlyn