Pressure on people renewing mortgages or trying to get new mortgages has eased slightly, new data shows.
The average interest rate on five-year fixed-rate mortgages fell below 6% on Tuesday for the first time in seven weeks and stayed there on Wednesday, financial information service Moneyfacts said.
Mortgage rates soared after the government’s mini-budget in September, driving up costs for borrowers.
Rates have stabilized since the fall statement last week, experts say.
Average five-year mortgage rates hit 5.95% on Tuesday and stayed flat on Wednesday, Moneyfacts said. This is down from a high of 6.51% on Oct. 20.
Two-year mortgage rates, which are more common, have also gradually fallen to 6.14% from 6.65% on October 20th.
Rachel Springall, finance expert at Moneyfacts, said: “Borrowers who have paused their homeownership plans or who have actually parked the idea of refinancing may now be tempted to check out the latest deals on offer.
“However, it’s worth noting that rates could fall further, but there’s no clear answer as to how quickly that could be.”
Despite the decline, rates are still high compared to this time last year when they were closer to 2.5%.
Interest rates have risen over the year as the Bank of England raised rates to fight inflation, but have skyrocketed after the mini-budget.
Jeremy Cox, head of strategy at the Coventry Building Society, said the autumn statement helped bring mortgage rates down by giving markets “greater confidence in the UK’s fiscal outlook”.
He said the pace of cost of living growth in the UK is “still very high” but US inflation is starting to fall, “and hopefully that will mean that [UK] Interest rates don’t need to keep rising as fast as they have been.”
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