Mortgage rates could fall by Christmas but experts warn against waiting

Summarised from 4 outlets · Updated 20 Oct, 09:57 · Archive

Lenders including HSBC and NatWest have begun cutting mortgage rates, with experts predicting further falls of up to 0.35 percentage points by Christmas.

Mortgage rates could be cheaper by Christmas, with lenders beginning to cut rates again this week. HSBC has reduced selected fixed mortgage rates by up to 0.14 percentage points, offering two-year deals starting at 4.96% and five-year deals at 4.99%. NatWest has also cut selected rates by up to 0.17 percentage points, with five-year deals starting at 4.95%.

These reductions follow average fixed mortgage rates climbing to or close to 6% earlier this month. According to Moneyfacts, the average five-year fixed mortgage rate hit 6% on October 5, while the average two-year fixed rate reached 5.98%.

Mortgage experts predict rates could edge lower by Christmas as lenders compete for customers and respond to any improvement in wholesale funding costs. Steven Greenall, Mortgage and Protection Advisor at Protect & Lend, expects fixed rates to fall further, provided economic conditions remain relatively stable. He said: 'I anticipate rates to be a little lower than now, at around 0.25% to 0.35% lower than where they are currently for two and five-year fixed.'

However, experts have warned borrowers against waiting for dramatic reductions. They cautioned that any reductions are likely to be gradual rather than substantial. Volatile swap rates, inflation and geopolitical events could quickly reverse recent progress, and some of the latest cuts may simply undo increases introduced earlier in October rather than signal a sustained fall.

How it is being reported

• Mortgage rates could get cheaper by Christmas – but experts warn against waitingMortgage rates could be cheaper by Christmas - but experts warn borrowers against waiting for a big dropWestmorland Gazette · 20 Oct, 09:31
• Mortgage rates could get cheaper by Christmas – but experts warn against waitingMortgage rates could be cheaper by Christmas - but experts warn borrowers against waiting for a big dropNW Evening Mail · 20 Oct, 09:31
• Mortgage rates could get cheaper by Christmas – but experts warn against waitingMortgage rates could be cheaper by Christmas - but experts warn borrowers against waiting for a big dropWhitehaven News · 20 Oct, 09:31
• Mortgage rates could get cheaper by Christmas – but experts warn against waitingMortgage rates could be cheaper by Christmas - but experts warn borrowers against waiting for a big dropCumberland News · 20 Oct, 09:31

In this story: HSBC · NatWest · Steven Greenall · Protect & Lend · Moneyfacts

This summary was written by AI from the headlines and standfirsts above, and states as fact only what at least two outlets report. How we use AI · Report a problem