Mortgage product changes slowing: Moneyfacts

Mortgage products are increasingly available on the market for longer, according to Moneyfacts.

Data provided by the firm shows that the average shelf life of mortgage products has risen from 38 days in February 2019 to 48 days in April.

This, Moneyfacts says, may be put down to month-on-month falls in two- and five-year Swap rates, with the average two-year Swap rate falling from 1.12 per cent in March to 0.95 per cent this month.

The average five-year Swap rate has also declined, from 1.31 per cent to 1.07 per cent between the same time frame.

Meanwhile, the average two- and five-year fixed rates both only fell 0.01 per cent on a monthly basis.

However, according to Moneyfacts, not all fixed rates are remaining as static as the overall averages suggest. Several lenders are focusing on higher LTVs – the 95 per cent LTV tier has fallen from 3.46 per cent in January to 3.30 per cent in March, for example.

Moneyfacts finance expert Darren Cook comments: “It is probable that mortgage providers may be stepping back and waiting for greater economic certainty before they return to making strategic changes to their mortgage ranges.

“Further supporting a ‘wait and see’ approach from providers this month is the lack of movement in the average two- and five-year fixed rates.

“Swap rates have historically been a reliable indicator in anticipating which direction rates on fixed rate deals may be going.

“Significant swap rate decreases or increases for a prolonged period may indicate that the average two- and five-year fixed rates are likely to follow suit, as has been seen when market speculation is rife of a suggested base rate change.”

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