Fixed rate price drops slow down, Moneyfacts data reveals


The average rate for a two-year fix fell 3 basis points, to 5.33%, and the average rate for a three-year fix slipped by a single basis point, to 5.22%.

Meanwhile, the average rate for a five-year fix lost 3 basis points, taking it to 5.05%, and the average price for a 10-year fix was reduced by 6 basis points, coming to 5.04% on Friday, 17 February.

Two-year fixes

Changes of note here took place at 95% LTV, where the average rate lost 2 basis points, giving a new price of 5.89% and, at 60% LTV, the average rate dropped 6 basis points, to 4.91%.

There was a rare move upwards too. At 70% LTV, a 4 basis point gain took its average rate to 5.60%.

Three-year fixes

As the headline rate change hints at, there were minimal changes here this week. While most rates at each LTV segment did fall, this was limited to a maximum move of 1 basis point.

Five-year fixes

At 95% LTV, the average rate lost 9 basis points, which gave a price of 5.41%.

And at 60% LTV, the average rate dropped 6 basis points, to 4.82%.

10-year fixes

There were just three changes here this week, but all were significant.

At 80% LTV, the average rate was reduced by 13 basis points, to 4.69%. The average rate at 75% LTV fell, too – this time by 9 basis points, to 4.67%.

And at 60% LTV, an 8 basis point cut left the average rate at 5.08%.

Moneyfacts finance expert Eleanor Williams comments: “The residential sector has again seen competitive rate re-pricing this week, with providers such as first direct implementing some Best Buy worthy rate cuts, seeing some of its fixed rate products reduce by as much as 1.05%, and by up to 0.25% on selected variable rates.

“Barclays Mortgage also reduced various of its fixed rate offerings, in this case by up to 0.44%. Hodge cut up to 0.40% from its ‘Professionals only’ two-year fixed deals available up to 80% loan-to-value, and by 0.50% on the 90% LTV equivalents.

“From the mutuals there was quite a lot of activity this week. This included updates from Nationwide Building Society, where reductions of up to 0.20% were applied across both fixed and variable products between 0% and 90% LTV, and also slashing up to 0.70% from its offerings at 95% LTV.

“Newcastle Building Society also implemented rate cuts, with selected fixed options falling by as much as 0.79%. Cambridge Building Society refreshed a selection of its fixed rates including ‘interest-only’ offerings with maximum reductions of up to 0.35%. Elsewhere, Hinckley & Rugby reduced some of its two-year fixed products by up to 0.26%, while Darlington Building Society cut up to 0.40% from selected fixed rates and up to 0.16% from various discounted variable rate deals.

“Lloyds Bank made a couple of updates this week, which included reducing its variable tracker deals by up to 0.23% (with the exception of the 90% LTV option for those purchasing which increased by 0.17%), and also reducing selected house purchase fixed rate deals by up to 0.47% – although its two-year fixed purchase options at 95% LTV were increased by 0.13%.

“Halifax mirrored the variable tracker product amendments seen at Lloyds Bank and also cut a selection of its fixed rates by up to 0.36%, as well as adding a ‘Green’ option to its fixed rates for remortgage borrowers this week.”

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