Mortgage product choice is “thriving” at nearly 7,000, showing that the market can “prosper after market turmoil”.
Moneyfacts‘ figures show that mortgage product choice more than halved between 1 March 2020 and 1 May 2020 to 2,556, and choices at higher loan to values (LTVs) also dropped dramatically.
From 1 September 2022 to 1 October 2022, the mortgage market had its largest drop of mortgage product choice since the pandemic, with deals contracting by around 1,632 to 2,258 products.
From 1 April 2025, mortgage product choice stood at 6,870 deals on the market.
Rachel Springall, finance expert at Moneyfactscompare.co.uk, explained that product choice in the mortgage market was “thriving”, but should there be an “unexpected dip”, the market has shown it can “bounce back and overcome years of turmoil”.
“Five years ago, the Covid-19 pandemic and UK lockdown set in motion an unprecedented situation for consumers. Not only did this impact people’s everyday lives, but the turmoil caused havoc for lenders and savings providers. Whether someone was buying a home or saving a pot for their future goals, the years that ensued [were] challenging to say the least.
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“Those consumers looking at their current situation would do well to make every effort to budget and save to help them cover any unexpected costs. Thankfully, there was a rise to the households’ savings ratio, according to the Office for National Statistics (ONS), during Q4 2024 – up to 12% from 10.3% the previous quarter. This is a record high outside of the significant jumps seen around the UK lockdown,” Springall said.
She noted that lenders would be “watching markets closely right now… to see how such volatility will play a part in their pricing strategies”.
“There is an abundance of choice for mortgage borrowers, and there is a big expectation for lenders to do more to stimulate UK growth. The positive recovery in mortgage choice comes after a dramatic five years of ups and downs,” Springall noted.
She said mortgage product choice nosedived after the pandemic lockdown, losing over 2,000 deals, and while lenders did support their existing customers, they “reined in their intentions to lend out to new buyers”, such as first-time buyers with small deposits as they reassessed their level of risk.
As a result, it took five years for the quantity of deals at 95% LTV to recover and it took several months for overall product choice to breach 5,000 options.
“As time marched on, both the UK and the mortgage market started to get back to business, and the Bank of England base rate eventually rose from its record low of 0.1% to 0.25% in December 2021.
“Several base rate increases followed as inflation started to rise at a worrying pace, but no one was prepared for market turmoil soon to come. During the latter part of 2022, product choice saw another damaging monthly fall, of 1,632 deals between September and October 2022, which came as the fiscal announcement, or ‘mini Budget’, was delivered on 23 September 2022.
“Six months later, choice breached 5,000 deals and the number of deals at 95% LTV breached 200. The market today for borrowers with limited deposits has improved, and despite the end of stamp duty relief last month, lenders have been working hard to entice new business, with some even offering cashback in the thousands to support buyers. Affordability remains a key issue for buyers, so saving for a large deposit can still feel like an uphill struggle – so choosing the right savings account is essential,” she said.