UK financial data shows that the Bank of England’s move to lower the base interest rate will reduce variable mortgage products’ payments by nearly £30 per month.
Average tracker mortgages fell £28.97 per month, while typical standard variable-rate home loans fell £13.87 per month.
The UK has 8.4 million outstanding mortgages and 591,000, or 7% is a tracker, while 540,000, or 8% is a standard variable rate.
However, the vast majority of mortgagists use fixed-rate products, mainly two- and five-year fixed products, accounting for 7.1 million loans in the market, or 85%.
Although lenders lowered prices this year, fixed-rate deals in 2025 will be refinancing in 2025.
Today, the average fixed mortgage rate for two years has dropped to its five-year peer for the first time, according to MoneyFacts data.
The average two-year fixed amount is 5%, while the five-year interest rate is 5.01%.
The last ratio in two years is lower than in September 2022, the month when Prime Minister Liz Truss sets up his mini budget.
At that time, the average two-year repair rate was 4.24%, while the five-year term was 4.33%.
Shorter fixes have been cheaper since this date than five years, usually expected in more common markets at the opposite time.
“Millions of borrowers reached this year will be delighted to see a downward trend in fixed mortgage rates, with an average two-year fixed interest rate falling to its five-year peers since September 2022,” said Rachel Springall, a financial expert at Moneyfacts.
Springall added: “The end of the reversal Two-year and five-year fixed interest rates, If continued development will bring borrowers back to the more traditional mortgage market, where it is more expensive to obtain long-term fixed mortgages.
