The last week has seen a flurry of fixed rate mortgages coming down in price, according to mortgage advisors John Charcol.
Despite high swap rates and a static base rate, which continues to languish at 0.5 per cent for the tenth consecutive month, Chelsea, Coventry, Halifax, HSBC, Nationwide, and Yorkshire Building Society have all cut the cost of their fixed rate mortgages.
Ray Boulger, spokesperson for John Charcol, explained the sudden influx in cheaper fixed rate mortgages: "There is undoubtedly an increase in competition with a number of new lenders currently in the starting blocks waiting for the gun," he said. "Additionally, lenders are far less dependent on swap rates for their new funding, rather looking toward their savers to balance the books."
Improvements in wholesale funding, rising house prices, the expectation that interest rates will remain low for some time to come, and a lower number of repossessions than expected, have all combined to increase confidence in the wider economy, subsequently making mortgage lenders less wary.
Analysis from John Charcol also shows that competition is returning to the buy to let mortgage market, with an increased range in products and lower rates coming onto the market.
"With the buy to let market suffering badly over the last 2 years, this is welcome news for many of the UK's landlords," Mr Boulger said of the signs of recovery in the buy to let sector.
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