This is according to the latest data from Moneyfacts, which revealed the average two-year fixed rate has climbed slightly from 5.32% in March to 5.35% in April.
It’s still cheaper to fix into a five-year deal, although the average rates for these products have increased from 5% to 5.05% during April.
Despite these hikes, fixing your mortgage rate still looks more attractive than defaulting to your lender’s standard variable rate (SVR) when your deal ends.
The average SVR has risen from 7.12% in March to 7.30% in April – the highest rate since February 2008, according to Moneyfacts.
Meanwhile, the total number of mortgage deals available has also climbed in the last month from 4,372 to 5,146 which experts say is good news as it comes just six months after the mortgage crisis, when hundreds of deals were pulled.
Rachel Springall, finance expert at Moneyfacts, said: “The number of mortgage products has risen to its highest point in over a year, boosting choice for consumers comparing deals and sets a positive movement across the market.
“The encouraging rise in products comes around six months on from the unprecedented uncertainty surrounding interest rates following the fiscal announcement.”
And whilst fixed-rate prices have increased over the month, Springall was optimistic. She said: “Interest rate competition among lenders was mixed month-on-month, however it is widely expected that fixed mortgage rates will reduce over the next few months, but this will be determined by fluctuating swap rates and lenders appetite for business.
“Those borrowers with a large deposit or equity may be pleased to see the average rates at 60% loan-to-value for a two-year or five-year fixed mortgage stand below 5%.
“However, those who are coming off a two-year fixed mortgage and wish to refinance on the same term (60% LTV) may wish to note the average rate on a two-year fixed mortgage in April 2021 was 1.63%, compared to 4.95% for April 2023.”
Springall said borrowers comparing fixed rates with variable deals should seek independent financial advice to assess the true cost of any deal, and to ensure it’s the right time for them to refinance.
| Mortgage market analysis (Source: Moneyfacts) | ||||||
| Apr-21 | Apr-22 | Oct-22 | Mar-23 | Apr-23 | ||
| Fixed and variable rate products | Total product count – all LTVs | 3,842 | 4,925 | 2,258 | 4,372 | 5,146 |
| Product count – 95% LTV | 34 | 367 | 132 | 161 | 204 | |
| Product count – 90% LTV | 440 | 665 | 295 | 546 | 684 | |
| Product count – 60% LTV | 515 | 529 | 337 | 657 | 702 | |
| All LTVs | Average two-year fixed rate | 2.58% | 2.86% | 5.43% | 5.32% | 5.35% |
| Average five-year fixed rate | 2.77% | 3.01% | 5.23% | 5.00% | 5.05% | |
| 95% LTV | Average two-year fixed rate | 4.47% | 3.19% | 5.54% | 5.85% | 5.89% |
| Average five-year fixed rate | 4.32% | 3.37% | 5.49% | 5.33% | 5.27% | |
| 90% LTV | Average two-year fixed rate | 3.45% | 2.94% | 5.33% | 5.50% | 5.64% |
| Average five-year fixed rate | 3.64% | 3.11% | 5.12% | 4.99% | 5.26% | |
| 60% LTV | Average two-year fixed rate | 1.63% | 2.35% | 5.08% | 5.01% | 4.95% |
| Average five-year fixed rate | 1.86% | 2.46% | 4.94% | 4.76% | 4.65% | |
| All LTVs | Standard Variable Rate (SVR) | 4.41% | 4.71% | 5.63% | 7.12% | 7.30% |
| All LTVs | Average two-year tracker rate | 2.27% | 2.21% | 3.77% | 4.84% | 5.02% |
| Data shown is as at the first available day of the month, unless stated otherwise. | ||||||
| Source: Moneyfacts Treasury Reports | ||||||
