‘It’s a refreshing change for borrowers who have endured mortgage mayhem since the start of March’
First-time buyers and home movers could benefit from reduced rates(Image: PA)
Three major UK mortgage lenders have slashed their rates today (April 24) which marks a positive signal for first-time buyers and home movers. A wave of banks and building societies have announced cuts this week, which is a refreshing change for borrowers.
Nationwide Building Society confirmed that, from Friday, it will lower rates across its fixed mortgage range for first-time buyers and home movers. Rates will be reduced by up to 0.25 percentage points across two, three and five-year fixed rate products.
Among the new rates will be a five-year fixed-rate first-time buyer mortgage for borrowers with a 10 per cent deposit at 5.25 per cent, reduced by 0.25 percentage points. The deal carries a £999 fee.
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First-time buyers will also receive £500 cashback upon completing their mortgage with Nationwide.
For home movers, Nationwide is offering a two-year fixed-rate mortgage for borrowers with a 40 per cent deposit at 4.50 per cent, reduced by 0.16 percentage points. The deal carries a £1,499 fee.
“We’re delighted to be able to make cuts to our mortgage rates to support both first-time buyers and those looking to move to their next home,” says Carlo Pileggi, Nationwide’s head of mortgage products.
“These changes apply across those ranges, with some of our largest cuts being made on higher loan-to-value mortgages, which will benefit first-time buyers looking to get onto the property ladder.”
Halifax Intermediaries has also confirmed it will implement rate reductions of up to 0.15 percentage points on fixed-rate mortgages for home movers and first-time buyers from Friday.
First Direct also slashed rates across dozens of two and five-year fixed mortgage products on Thursday, with reductions of up to 0.38 percentage points.
“We are committed to supporting our customers on their house purchase journey and continue to review our pricing regularly to ensure the best value we can for all our customers,” said Liam O’Hara, head of mortgages at First Direct.
HSBC UK likewise trimmed rates across its mortgage range on Thursday, with cuts of up to 0.25 percentage points. The reductions offer a boost to first-time buyers, home movers and those looking for a buy-to-let mortgage, the bank confirmed.
HSBC’s offerings include a five-year mortgage for first-time buyers with a 15 per cent deposit at 5.04 per cent, down by 0.13 percentage points. The deal carries a £999 fee and comes with £750 standard cashback, rising to £1,500 for energy-efficient homes.
Virgin Money also trimmed some mortgage rates from Thursday, covering home buyers, those remortgaging, and buy-to-let products.
Earlier this week, Santander announced plans to reduce rates on lower-deposit first-time buyer and home mover mortgage products from Friday.
The cuts include Santander’s 98 per cent LTV (loan-to-value) My First Mortgage product, which is being reduced by 0.25 percentage points to 5.60%.
The bank will also launch first-time buyer products, among them a 5% deposit three-year fixed-rate mortgage at 5.55% with no fee and £250 cashback. Barclays and Skipton Building Society also cut their mortgage rates on Wednesday.
Swap rates, which lenders use to price mortgages, have been easing. The conflict in the Middle East has caused market volatility and driven up expectations that interest rates will remain higher for longer.
Several lenders making cuts this week had also reduced mortgage rates the previous week. However, despite the recent rounds of rate reductions, typical fixed mortgage rates remain high compared with the beginning of March.
The average two-year fixed-rate homeowner mortgage stood at 4.83 per cent at the start of March, rising to 5.82 per cent by Thursday morning, according to financial information website Moneyfacts.
The average five-year fixed-rate mortgage has climbed from 4.95 per cent at the start of March to 5.72 per cent on Thursday morning, the website added.
Rachel Springall, a finance expert at Moneyfactscompare.co.uk, said Nationwide’s mortgage rate cuts are a “positive signal” for borrowers looking to buy their first home or to move.
“New buyers usually have very little to put down as a deposit, so it’s great to also see cuts to deals at higher loan-to-values,” she said.
“Nationwide will now offer some of the lowest fixed rates across the market, such as with its two-year fixed deal at 60% LTV priced at 4.50% for home movers, a highly attractive rate in the current market.
“We have had numerous mortgage rate cuts over recent days, and tomorrow, Santander will make further cuts of up to 0.25 (percentage points), after making cuts of up to 0.28 (percentage points) just last Thursday.
“Borrowers will hope the positive sentiment to cuts continues as last week, the rate moves led to the first week-on-week fall in average fixed rates since the conflict in the Middle East began.”
Ms Springall added: “As things stand, rates are moving lower than they were set a week ago, but there is no telling how many more cuts we might get in the days ahead.
“It will be a refreshing change for borrowers who have endured mortgage mayhem since the start of March. Lenders will be looking to reprice to catch up to moving swap rates, but also to compete for new business, it’s all in the margins.
“Any borrower concerned about securing a mortgage would be wise to seek advice from a broker to navigate the mortgage maze.”
David Fell, lead analyst at Hamptons, said: “The downward drift in mortgage pricing over the last week or so is a reflection of a significant shift in market sentiment.
“In late March, swap rates had priced in the possibility of three interest rate hikes by the end of the year. However, that outlook has since shifted significantly, with the market now pricing in just over one hike by the end of 2026.
“This pivot has given lenders breathing room to make rate reductions and pass savings on to borrowers, first-time buyers in particular.”