The average shelf-life of a mortgage has dropped to 15 days, down from 28 days a month prior. This is according to data from the Moneyfacts UK Mortgage Trends Treasury Report, which also shows that average mortgage rate rises on overall two- and five-year fixed rate deals were more modest compared to the month prior, up by 0.02%. This was the smallest monthly rises seen this year.
The overall average two- and five-year fixed rates rose between the start of May and the start of June, to 5.93% and 5.50% respectively. The average two-year fixed rate remains 0.43% higher than the five-year equivalent – the gap between these averages has not been higher than this since October 2023 (0.50%).
The average ‘revert to’ rate or Standard Variable Rate (SVR) remained at 8.18%, just shy of the highest recorded (8.19%) during November and December 2023.
The average two-year tracker variable mortgage fell to 5.94%.
Product choice overall rose month-on-month, to 6,629 options, its highest level since February 2008 (6,760).
Moneyfacts finance expert Rachel Springall said: “Borrowers may feel disheartened to see another consecutive month of rises to the average two- and five-year fixed mortgage rates. However, both rose by a modest 0.02%, the smallest month-on-month rise this year. The incentive to fix for longer remains, with the average five-year fixed rate standing 0.43% lower than its two-year counterpart, and the incentive to remortgage is prevalent, as the average Standard Variable Rate (SVR) stands at 8.18%.”
Springall pointed out that lenders spent the first few weeks of May repricing, in reaction to a volatile swap rate market, but the latter end of the month was more subdued, around the time the Government announced there would be a General Election in July.
She added: “Despite the small uplift in rates, there was another rise in the overall product availability of residential mortgages, standing at its highest point in 16 years.
Year-on-year the overall availability of mortgages has risen by 1,662 deals, and within that pool of products, there are 156 more at 90% loan-to-value (LTV) and 124 more at 95% LTV. These rises are good news for borrowers who may be struggling to build a big enough deposit to secure a new deal.”
