Mortgage shelf-life drops and lenders increase rates
The average shelf-life of a mortgage has dropped to 15 days, down from 28 days a month earlier, the latest Moneyfacts UK Mortgage Trends Treasury Report data shows.
Month-on-month rises to the average two- and five-year fixed mortgage rates were more modest, with average mortgage rate rises up by 0.02%, the smallest monthly rises seen this year. These rates remain slightly lower compared to December 2023.
The overall average two- and five-year fixed rates rose between the start of May and the start of June, to 5.93% and 5.50% respectively. The average two-year fixed rate remains 0.43% higher than the five-year equivalent – the gap between these averages has not been higher than this since October 2023 (0.50%).
Meanwhile, the average ‘revert to’ rate or Standard Variable Rate (SVR) remained at 8.18%, just shy of the highest recorded (8.19%) during November and December 2023, while the average two-year tracker variable mortgage fell to 5.94%.
The data also reveals that product choice overall rose month-on-month, to 6,629 options, its highest level since February 2008 (6,760).
· The average shelf-life of a mortgage product fell to 15 days, its lowest since March, down from 28 days a month prior. The lowest shelf-life average on our records was 12 days in July 2023.
| Mortgage market analysis | ||||||
| Jun-22 | Jun-23 | Dec-23 | May-24 | Jun-24 | ||
| Fixed and variable rate products | Total product count – all LTVs | 4,987 | 4,967 | 5,694 | 6,565 | 6,629 |
| Product count – 95% LTV | 347 | 229 | 253 | 347 | 353 | |
| Product count – 90% LTV | 672 | 636 | 718 | 791 | 792 | |
| Product count – 60% LTV | 546 | 635 | 623 | 748 | 733 | |
| All products | Shelf-life (days) | 21 | 22 | 17 | 28 | 15 |
| All LTVs | Average two-year fixed rate | 3.25% | 5.49% | 6.04% | 5.91% | 5.93% |
| Average five-year fixed rate | 3.37% | 5.17% | 5.65% | 5.48% | 5.50% | |
| 95% LTV | Average two-year fixed rate | 3.46% | 6.06% | 6.34% | 6.14% | 6.20% |
| Average five-year fixed rate | 3.54% | 5.43% | 5.73% | 5.64% | 5.73% | |
| 90% LTV | Average two-year fixed rate | 3.27% | 5.66% | 6.01% | 6.12% | 6.15% |
| Average five-year fixed rate | 3.35% | 5.23% | 5.71% | 5.57% | 5.61% | |
| 60% LTV | Average two-year fixed rate | 2.91% | 5.11% | 5.59% | 5.45% | 5.45% |
| Average five-year fixed rate | 3.05% | 4.85% | 5.20% | 5.08% | 5.06% | |
| All LTVs | Standard Variable Rate (SVR) | 4.91% | 7.52% | 8.19% | 8.18% | 8.18% |
| All LTVs | Average two-year tracker rate | 2.54% | 5.32% | 6.16% | 6.12% | 5.94% |
| Data shown is as at the first available day of the month, unless stated otherwise. | ||||||
| Source: Moneyfacts Treasury Reports | ||||||
Rachel Springall, finance analyst at Moneyfacts, said: “Borrowers may feel disheartened to see another consecutive month of rises to the average two- and five-year fixed mortgage rates. However, both rose by a modest 0.02%, the smallest month-on-month rise this year. The incentive to fix for longer remains, with the average five-year fixed rate standing 0.43% lower than its two-year counterpart, and the incentive to remortgage is prevalent, as the average Standard Variable Rate (SVR) stands at 8.18%. Lenders spent the first few weeks of May repricing, in reaction to a volatile swap rate market, but the latter end of the month was more subdued, around the time the Government announced there would be a general election in July.
“Despite the small uplift in rates, there was another rise in the overall product availability of residential mortgages, standing at its highest point in 16 years. As lenders reviewed their ranges, which included repricing, launches and withdrawals, the moves led to the average shelf-life of a mortgage plummeting to 15 days, down from 28 days at the start of May. Year-on-year the overall availability of mortgages has risen by 1,662 deals, and within that pool of products, there are 156 more at 90% loan-to-value (LTV) and 124 more at 95% LTV. These rises are good news for borrowers who may be struggling to build a big enough deposit to secure a new deal. On the other end of the spectrum, there are just 98 more deals at 60% LTV, and month-on-month, there was a slight fall of 15 deals.”
