Fixed mortgage rates begin to fall from 14-year highs

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Fixed mortgage rates begin to fall from 14-year highs: Average five-year deal now at 5.59% – down from 6.51% last month

Five-year fixed mortgage rates have dropped below 6 per cent for the first time in seven weeks.

The average five-year fix is now 5.59 per cent, down from a 14-year high of 6.51 per cent last month, says comparison website Moneyfacts. 

It says two-year fixed rates have also decreased, with deals averaging at 6.13 per cent, down from a peak of 6.65 per cent in October.

Rate relief: The average five-year fixed mortgage is now 5.59 %, down from a 14-year high of 6.51% last month, according to Moneyfacts

Rate relief: The average five-year fixed mortgage is now 5.59 %, down from a 14-year high of 6.51% last month, according to Moneyfacts

Yesterday Santander and Barclays both decreased their fixed-rate deals by 0.3 percentage points.

Mortgage rates spiralled last month in response to Kwasi Kwarteng’s disastrous mini-budget in September. Around 80 per cent of mortgages are currently fixed.

Rachel Springall, finance expert at Moneyfacts, says: ‘Borrowers may well breathe a sigh of relief to see that fixed mortgage rates are starting to fall, but there may be much more room for improvement. 

‘Rates could fall further still, but there is no clear answer as to how quickly that may be.

‘Borrowers may feel they have to be patient for a little while longer before they commit to a new fixed mortgage.’

Tracker rates have also started to fall. Santander reduced its tracker range by 1.25 percentage points yesterday. 

And on Monday, Yorkshire Building Society decreased its tracker products by up to 1.16 percentage points. Tracker deals are tied to the Bank of England base rate, which is currently at 3 per cent.

They have rapidly increased in popularity in the past couple of months following large interest rate rises for fixed mortgage deals.

a.cooke@dailymail.co.uk

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