The lender has made rate reductions of up to 0.21% in a bid to help its members make savings on their monthly mortgage payments.
It has announced these price improvements ahead of the removal of stamp duty land tax relief coming into effect from 1 April. This is when the stamp duty threshold for first-time buyers will drop to £300,000 from £425,000, which Leeds said would affect approximately one in five purchases, based on banking data from January to September 2024.
With this additional challenge ahead, Leeds wanted to make the price changes to ‘help more people into homeownership’.
It said, based on 90% loan on an average house price of £282,000, a first-time buyer taking its two-year fee-free rate of 5.25% would save over £450 per year compared to taking the equivalent product in January 2024.
For existing mortgage holders, Leeds Building Society is making rate reductions of up to 0.21%. Data shows that in the first quarter of 2025, there will be nearly 328,000 residential mortgages maturating across the market, so these rate reductions will be timely.
Rachel Springall, finance expert at Moneyfacts, said: “First-time buyers may well be struggling to amass a large enough deposit to get their foot onto the property ladder, so it’s great to see competitive deals launched onto the market to try and support these buyers.
“The market could always do with more product innovation to help those struggling to get a mortgage as those stuck paying rent may feel their homeownership dreams are scuppered because of the lack of affordable housing, which will take time to improve.
“As we move into 2025, it will be interesting to see how lenders will balance supporting their existing customers and enticing new business as the future of interest rates remains unpredictable.”
Meanwhile, David Hollingworth, associate director at mortgage broker, L&C Mortgages, said: “With the rate outlook still carrying an element of uncertainty borrowers will need to keep on top of their mortgage costs.
“Lenders competed hard throughout 2024 and there’s nothing to suggest that will change in 2025.
“It’s therefore encouraging to see these rate reductions being made so early in the year, improving the choice for first time buyers, homemovers and those remortgaging alike.
“The market is likely to be just as fast moving this year, so advice will continue to play a crucial role for customers looking to target the best deals for them.”
