Many people across the UK are asking when will mortgage rates will drop?
For those who already own a property, the prospect of remortgaging may seem daunting since rates increased in 2023.
Those looking to move to a new property may also be waiting for mortgage rates to drop to make their next purchase just that bit more affordable.
When will mortgage rates drop?
The good news is that they are starting to drop already.
It was reported this week that rates dropped below 4% at Nationwide, the UK’s largest building society. The rate is 3.84% at the time of writing.
This is the cheapest deal provided by the company for 8 months and is also significantly under the Bank of England’s base interest rate.
This is only available currently to those who are remortgaging although it’s still not bad news for first time buyers; the rate offered to those looking to take a first step onto the property ladder is only 0.01% higher at 3.85%.
Both these products are 5 year fixed rate deals and are significantly lower than the average offered by other lenders which stood at 5.2% this week.
Will other mortgage lenders follow suit?
Although some lenders are following the trend of sub 4% products, some are actually increasing.
Santander recently increased their rates on some mortgage products by 0.2% for remortgages.
This though is still well below the average last summer when rates stood at around 6%.
Should you wait for rates to drop further?
Unfortunately, we don’t have a crystal ball which will tell us the future relating to mortgage rates.
As we’ve seen this week, rates can go up and down and fluctuate daily.
For now, we feel that rates are likely to stick at around this mark for the next few months.
The best advice we can give at Benwell Daykin is always talk to our qualified mortgage broker who will be able to advise you in more detail.
Products can vary depending on your own circumstances too, so it’s always a good idea to compare the whole of the market with a broker and find out which products match your criteria.
For some, this will now be the best time to buy a new property as rates are now becoming more affordable.