Average fixed mortgage rates edge up amid tough wider market conditions

Average fixed mortgage rates have edged up slightly amid tough wider market conditions, with a dwindling number of sub-4% deals available, according to a financial information website.

Across all deposit sizes, the average two-year fixed homeowner mortgage rate on the market on Tuesday was 5.70%, according to financial information website Moneyfacts. This was up from an average rate of 5.69% on Monday.

The average five-year fixed homeowner mortgage rate was 5.28% on Tuesday. This was up from an average rate of 5.27% on Monday.

Rachel Springall, a spokeswoman for Moneyfacts, said: “The swap rate market (which is used by lenders to price their loans) has been notably volatile over the past month, and rises are having an impact on fixed rates.

“The average two-year fixed mortgage rate appears to be rising more than longer-term rates for now, so it’s possible short-term fixed pricing will remain a key focus for lenders reviewing their margins in the coming weeks.

“As always, its vital borrowers seek (the) advice of a mortgage broker to review their options.”

According to Moneyfacts’ data, at the start of February, several major lenders had fixed mortgage rates priced below 4%, including Santander, Nationwide, Halifax, HSBC UK and NatWest.

But, on Tuesday, its records showed a handful of lenders offering fixed rates below 4%, including HSBC UK, AIB and Danske.

The figures were released as Santander UK announced that from Wednesday, it was increasing residential and buy-to-let rates in its new business range.

It was also increasing some residential and buy-to-let fixed rates in its product transfer range.

A Santander spokesperson said: “Santander continually reviews its rates based on a number of factors, such as wider market conditions including swap rates.

“We offer a range of competitive mortgage deals with five-year deals starting from 4.17% and two-year deals starting from 4.53%.”

The increases would mean that, for example, for new business, residential fixed rates would increase by up to 0.34 percentage points.

For product transfers, selected residential fixed rates would increase by up to 0.20 percentage points.

The bank said there would be no change to tracker rates.

Mortgage rates jumped following the mini-budget, but have been on a general downward path in recent months as inflation has eased.