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Mortgage Rates Diagram

Relief for Homebuyers drives market interest

Posted by big_marketing on August 23, 2024
Buying Properties, Cost of Living, Price
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Mortgage rates have fallen to their lowest levels for 2 years, signalling the end of the Liz Truss mini budget meltdown.

One bank is offering 3.83% fixed for 5 years, and others are following suit. Seven of the ten largest lenders are now offering fixed rate deals below 4%.

Mortgage rate cuts over the past couple of months have made buyers hundreds of pounds better off as banks seek to inject life into a property market which was dented by the higher costs of living and borrowing.

This has piqued the market as many homeowners had delayed potential moves because of concerns over house prices and more expensive mortgages.

“With base rates now lower, and fixed rates falling into line there is a bigger desire to move, and we are seeing this reflected in the number of enquiries we are receiving” said James Bickers, Senior branch Manager at Lane & Browns.

However, first time buyers who believe they can hold off until rates fall lower may be in for a nasty surprise as they could end up paying more stamp duty. From April 2025 the threshold at which first time buyers pay stamp duty at a rate of 5% will fall from £435,000 to £300,000.

The property portal Rightmove said the number of prospective buyers contacting estate agents was 19% higher than in the same period last year, and the number of sales agreed is up 16% compared with last year.

With the Summer holidays coming to an end, Lane & Browns are looking forward to an active Autumn market, with house prices expected to rise 1% over the coming months, bringing parity to last years 1% decline, as a result of buyers returning to the market.

Rates have been coming down since last Summer when they peaked at 6.85% for a 2 year fixed rate mortgage. This is good news for many homeowners as over 470,000 deals are due to end between September and December according the Financial Conduct Authority.  Although they are not back to the halcyon days of 2.4% these falling rates are expected to soften the blow. The lowest remortgaging deal is now 4.06% from Barclays on a five-year fixed rate.

You can see a selection of houses and flats for sales on our website : Property for sale

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