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HSBC, Santander, and NatWest are some of the biggest banks that have increased their lowest mortgage rates in recent days following a surprise rise in the cost of funding.

Even though Barclays, Halifax, and Skipton have also raised rates, two-year fixed mortgages are still available from around 4% and five-year fixes from around 3.75%. More lenders will probably raise their rates in the coming days, although they are likely to come back down again over the near term.

Halifax for Intermediaries has launched a range of Bank of England tracker rates without early repayment charges to provide borrowers with more flexible deals. Halifax's most competitively priced variable mortgage tracks the current 5% base rate with a margin of 0.08%.

Tracker rates have increased in popularity, and if HSBC's predictions are correct, more borrowers may take them. HSBC expects the Bank of England base rate to reduce significantly, reaching 3.25% by September 2025 and 2.75% by December 2025. However, this may change depending on the US election results, particularly if Donald Trump is elected and there are significant tax changes.

Aaron Strutt, product director at Trinity Financial, says: "Some banks and building societies still offer sub-4% fixed rates for property purchases and remortgages, although there are fewer to choose from. The lenders are doing more to tempt borrowers to switch lenders rather than stick with their existing mortgage providers.

"We are helping lots of first-time buyers secure mortgages, and many want to complete their purchase well before the stamp duty increase next year."

Call Trinity Financial on 020 7267 9399 to secure a mortgage, book a consultation, or complete our mortgage questionnaire. 

The information contained within was correct at the time of publication but is subject to change.

Your mortgage is secured on your property. Your property may be repossessed if you do not keep up repayments on your mortgage

Many people expect the forthcoming budget to be tough, and there is speculation that chancellor Rachel Reeves will make changes to Capital Gains and Inheritance Taxes. 

In the latest The Property Exchange podcast, Winkworth CEO Dominic Agace is urging the Chancellor to “avoid intervening in the UK economy” on 30th October, warning that proposed changes to inheritance and capital gains taxes “will slam the brakes on growth.”

Speaking to property commentator Anne Ashworth, Trinity's Anthony Emmerson and Winkworth's CEO Dominic Agace suggest the Government should instead focus on helping first-time buyers with stamp duty and other incentives.

Call Trinity Financial on 020 7267 9399 to secure a mortgage, book a consultation, or complete our mortgage questionnaire. 

The information contained within was correct at the time of publication but is subject to change.

Your mortgage is secured on your property. Your property may be repossessed if you do not keep up repayments on your mortgage

Halifax for Intermediaries has finally launched a range of Bank of England base rate tracker mortgages without early repayment charges.

While many other banks and building societies, like HSBC and Santander, have offered flexible variable-rate mortgages for a while, Halifax has not, apart from its expensive standard variable rate. This lack of flexibility has been a real issue, particularly for Halifax's existing borrowers coming to the end of their deals.

Why would you need a tracker rate?

A tracker mortgage can offer more attractive terms if you plan to sell your home or make a lump sum overpayment or remortgage. They often provide an alternative to being locked into a fixed rate.

Unlike fixed-rate mortgages, where you know exactly what your monthly repayments will be, tracker mortgages are less predictable, as your monthly repayments can go up and down. However, they are a good option for those needing a flexible mortgage, maybe because they want to move or wait to see if fixed rates get cheaper before they are tied into a longer-term fix.

With lenders like HSBC predicting the Bank of England base rate to be closer to 3.25% over the next 18 months, tracker rates may increase in popularity. 

Are Halifax's new tracker mortgages worth taking?

Halifax offers a range of Bank of England tracker rates suitable for those looking for flexible mortgages. Its rates are more competitively priced than some of the other big banks. 

Halifax's lowest variable mortgage tracks the base rate with a margin of 0.08% over the current 5% base rate for those with a 40% deposit. This rises to 0.15% over the base rate if you have a 25% deposit and 0.54% over base if you have a 10% deposit.  

Aaron Strutt, product director at Trinity Financial, says: "If you opt for a tracker mortgage, it is well worth taking one without early repayment changes or with the option to switch to a fixed rate at any point without paying additional fees. Most borrowers take two—or five-year fixes without considering whether a tracker or offset mortgage would be more appropriate."

What are Halifax's arrangement fees?

The arrangement fee is £1,499 for Halifax's mortgages between £75,000 and £1 million, rising to £3,999 for mortgages between £1,000,001 and £5 million. 

Is anyone taking tracker rate mortgages?

Recent data from wealth management firm Quilter shows the number of tracker mortgages taken out over the past three years jumped by 67% even as interest rates rose.

The number of tracker mortgages taken, which offer interest rates that follow the Bank of England base rate often without early repayment charges, lifted from 118,818 loans in 2021 to 198,044 by the first quarter of this year.

Call Trinity Financial on 020 7267 9399 to secure a Bank of England tracker mortgage, book a consultation, or complete our mortgage questionnaire. 

The information contained within was correct at the time of publication but is subject to change.

Your mortgage is secured on your property. Your property may be repossessed if you do not keep up repayments on your mortgage 

Mortgage lenders are starting to increase their fixed rates following a sudden rise in the cost of funding, potentially making it worthwhile for borrowers to secure a mortgage rate now.

Coventry for Intermediaries has announced its rate will rise this week, and The Co-operative Bank for Intermediaries is having a rate reprice. Another large bank has suggested that borrowers apply soon to secure its leading rates.

Bank of England governor Andrew Bailey recently said the bank could be more aggressive in cutting the base rate, almost at the same time as the cost of borrowing started to increase.

Aaron Strutt, product director at Trinity Financial, says, "Mortgage rates have been coming down for weeks, and there are some great two, three, and five-year fixes to choose from. If your mortgage is coming up for renewal or you are buying somewhere, it does make sense to secure a rate now, monitor the market, and swap to a cheaper rate if one becomes available.

"HSBC is predicting multiple reductions to the base rate next year, so it is feasible that mortgage rates will come down again soon, but they are set to rise for the moment. Possibly by around 0.3%."

Why are mortgage rates starting to go up?

The US economy seems to be in better shape, with positive recent jobs market news. However, the Federal Reserve may not reduce its rate by the predicted 0.5%. The war in the Middle East is causing uncertainty, particularly regarding oil prices.

There is also the issue of the upcoming budget, with fears of additional government borrowing spooking the money markets, particularly after the recent mini-budget. The mortgage markets are closely linked to the Gilt markets. 

Gilt stands for "gilt-edged security" and refers to a UK government bond issued by HM Treasury. The term comes from the gilded edges on the paper certificates that the British government used to issue in the past.

Tracker rate mortgage popularity rising

While most borrowers opt for fixed rates, recent data from wealth management firm Quilter shows the number of tracker mortgages taken out over the past three years jumped by 67% even as interest rates rose.

The number of tracker mortgages taken, which offer interest rates that follow the Bank of England base rate often without early repayment charges, lifted from 118,818 loans in 2021 to 198,044 by the first quarter of this year.

Call Trinity Financial on 020 7267 9399 to secure a mortgage or book a consultation

The information contained within was correct at the time of publication but is subject to change.

Your mortgage is secured on your property. Your property may be repossessed if you do not keep up repayments on your mortgage

Mortgage lenders are still lowering their fixed rates following more price improvements from big banks like NatWest, HSBC, Barclays and Halifax.

Santander for Intermediaries lowered some of its fixed rates for property purchases and remortgages by up to 0.3% last week. It launched the new Best Buy two-year fix at just below 3.85% and the lowest five-year fix at just below 3.7%, although applicants will need a 40% deposit to qualify.

Both rates have £999 arrangement fees, a maximum loan size of £3 million, plus a free property valuation. MPowered Mortgages has also launched a leading three-year fix priced around 3.75%.

Please note that the cost of funding fixed rates has increased over the last few days, so there is a chance these fixed rates will rise. We will have to see how the mortgage lenders react to the pricing changes.

Tracker rate mortgage popularity rising

While most borrowers opt for fixed rates, recent data from wealth management firm Quilter shows the number of tracker mortgages taken out over the past three years jumped by 67% even as interest rates rose.

The number of tracker mortgages taken, which offer interest rates that follow the Bank of England base rate often without early repayment charges, lifted from 118,818 loans in 2021 to 198,044 by the first quarter of this year.

House prices rise close to record high

The average UK house price came close to reaching a record high last month as house prices increased for the third month in a row. Falling mortgage rates, according to Halifax, helped to boost confidence among buyers.

Halifax, the UK's largest mortgage lender, highlights the average house price hit £293,399 in September, just short of the record £293,507 reached in June 2022. House prices increased by +0.3% in September, matching the rise seen in August.

Amanda Bryden, Head of Mortgages at Halifax, said: “Market conditions have steadily improved over the summer and into early autumn. Mortgage affordability has been easing thanks to strong wage growth and falling interest rates. This has boosted confidence among potential buyers, with the number of mortgages agreed up over 40% in the last year and now at their highest level since July 2022.”

Call Trinity Financial on 020 7267 9399 to secure a mortgage, book a consultation, or complete our mortgage questionnaire. 

The information contained within was correct at the time of publication but is subject to change.

Your mortgage is secured on your property. Your property may be repossessed if you do not keep up repayments on your mortgage

The scale of mortgage rate changes has started to pick up again over the last few days, with many lenders sharpening their fixed rates. 

Coventry Building Society has undercut the biggest mortgage lenders by improving some rates by over 0.5%. It has just launched the lowest two-year fix at just below 3.90%, the most competitively priced three-year fix at just below 3.8% and a five-year fix at just below 3.7%.

Coventry's rates are available for borrowers purchasing a property, provided they have a 35% deposit and £999 arrangement fees. The remortgage rates are higher.

Virgin Money has also launched a sub-5% fixed rate for borrowers with a 5% deposit. It does not have an arrangement fee. 

Mortgage approvals up

Figures from the Bank of England show individuals borrowed £2.9 billion of mortgage debt in August, compared to £2.8 billion in July. Net mortgage approvals for house purchases rose from 62,500 in July to 64,900 in August, the highest level since August 2022 (72,000). Similarly, approvals for remortgaging increased from 25,200 to 27,200 over the same period.

Individual net consumer credit borrowing amounted to £1.3 billion in August, a slight increase from £1.2 billion in July.

According to Nationwide, UK house prices rose by 3.2% in September compared with a year ago—the fastest rate for nearly two years. Nationwide's most recent data by property type shows that terraced houses have seen the biggest percentage rise in prices over the last 12 months, with average prices up 3.5%. Semi-detached and flats saw increases of 2.8% and 2.7%, respectively. Detached houses saw a more modest growth of 1.7%.

Commenting on the figures, Nationwide's Chief Economist Robert Gardner said: “UK house prices increased by 0.7% in September, after taking account of seasonal effects. This resulted in the annual rate of growth rising from 2.4% in August to 3.2% in September, the fastest pace since November 2022 (4.4%). Average prices are now around 2% below the all-time highs in summer 2022.

“Income growth has continued to outstrip house price growth in recent months while borrowing costs have edged lower amid expectations that the Bank of England will continue to lower interest rates in the coming quarters. These trends have helped to improve affordability for prospective buyers and underpinned a modest increase in activity and house prices, though both remain subdued by historical standards.”

Call Trinity Financial on 020 7267 9399 to secure a mortgage or book a consultation

The information contained within was correct at the time of publication but is subject to change.

Your mortgage is secured on your property. Your property may be repossessed if you do not keep up repayments on your mortgage