Last week, the Bank of England cut the base interest rate from 5.25 percent to 5.0 per cent.
As a result of this cut, mortgage lenders quickly sprung into action, reducing some of their rates by a small amount.
This was good news for many home owners but wasn’t exactly the large decrease anyone was hoping for.
But what does it mean for the coming months? Will mortgage rates remain fairly high or will lenders start to drop rates further?
Mortgage rates Autumn 2024
The good news is that today, some lenders have slightly reduced mortgage rates further.
HSBC and Barclays are the latest to cut the interest on their deals. HSBC cut their best deal by 0.19 per cent and Barclays by 0.2 per cent.
The hope is that now more lenders will follow suit and rates should drop further.
Interestingly, the average still stands at around 5.74 per cent for a two year fixed.
With these new rates, someone with a £200,000 mortgage repaying over 25 years could expect to pay £1,050 a month with HSBC and £1,038 with Barclays.
The market average would be around £1,257.
Now let’s focus on Ruddington with a current average house price of £353,157. Those with a 20% deposit would be likely to pay £1,483 per month with the new HSBC rate and £1,466 with Barclays.
Mortgage rates in 2025
Many people are asking Benwell Daykin what this means for mortgage rates in 2025 and beyond.
Whilst we don’t have a crystal ball, we really don’t expect percentage rates to drop to those we have seen for the last few years at around 2 per cent.
Having said this, we would expect a further base rate cut from the Bank of England by the end of this year, if not into early next.
This would mean rates would drop slightly again, but not to the historic lows seen before.
Need mortgage advice?
This information has been gathered from our own research and does not constitute as mortgage advice. Please always speak to a qualified mortgage advisor before making any financial decision relating to your home. You can contact us on 0115 990 2007 to get mortgage advice today.
Are you coming to the end of your fixed term mortgage deal? Now would be the perfect time to see how much money you can save compared to July.