Fixed rates edge lower but affordability remains key issue: Moneyfacts – Mortgage Strategy


This week provided a healthy mix of fixed rate increases, withdrawals, and product launches, but the main focus was on fixed rate reductions, the latest Moneyfacts figures show.
Average two-year fixes dropped by 0.03% to 5.49% while average five-year fixes fell by a slightly smaller margin of 0.01% to 5.27%.
Royal Bank of Scotland was one of the most prominent brands to reduce selected fixed rates this week, cutting rates by up to 0.16%.
In addition, NatWest dropped rates by up to 0.16%, and HSBC by up to 0.21%. Contrastingly, TSB moved to increase fixed rates by up to 0.10%.
Building societies also made a few rates move this week. Those to reduce fixed rates included West Brom Building Society by up to 0.65%, Scottish Building Society by up to 0.20%, Nottingham Building Society by up to 0.10%, Coventry Building Society by up to 0.26%, Skipton Building Society by up to 0.32%, Principality Building Society by up to 0.10%, and Cumberland Building Society by up to 0.15%.
Other lenders who moved to reduce rates included Accord Mortgages by up to 0.36%, Atom Bank by up to 0.10%, and Gen H by up to 0.25%. However, Clydesdale Bank moved to increase selected fixed rates by up to 0.30%.
Moneyfacts also highlighted some “eye-catching” deals this week including a two-year fixed rate deal from HSBC, priced at 4.69% and available at 85% loan-to-value for house purchase customers.
The deal comes with a £999 product fee which is offset by its enticing incentive package which includes a free valuation and £250 cashback.
Moneyfacts spokesperson Caitlyn Eastell says: “Whilst it is promising that providers are moving to edge fixed rates in a downward trend, affordability remains a key issue for many prospective buyers.”
“The latest data from the Halifax HPI shows that the average house price has risen by 1.3% month-on-month to £298,083 which is the biggest increase so far this year.”
“The volatility in recent weeks showcases how sensitive the mortgage market remains to be and even with anticipated drops in interest rates in 2025 this may continue to be the case.”
“Borrowers that are eager to secure an enticing deal should do so with haste but would also be wise to seek independent professional advice to ensure they are getting the best deal.”

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