Ben Waugh, managing director of later life lender more2life, acknowledged how competition has ramped up over the past few weeks.
“In a somewhat subdued market, where consumers have been holding out for more suitable rates, lenders are in heated competition for business,” Waugh (pictured left) told Mortgage Introducer, “so the recent wave of rate reductions may mark the return of more preferential products.
“It’s too soon to tell whether the current trend will stick. We have heard rumblings from across the pond. If the Fed announces a cut in its rates, then other central banks may be more inclined to follow suit. In any case, many lenders will have already priced the cut into their fixed-rate products ahead of time, so this won’t result in any immediate downward pressure on mortgage rates more broadly.”
Waugh believes that, from a customer perspective, the current price war may open up a few opportunities to step on to the property ladder.
“The market is steering towards a more manageable economic climate, and the increased availability of competitive products is a positive step in the right direction,” he suggested, “but there are still difficulties that lie ahead for borrowers that aren’t going to disappear overnight. Asking prices are nearing record high levels and the reality is wage growth hasn’t gone nearly far enough to keep up.”