Halifax has announced it will be slashing rates across selected fixed mortgage deals from today, just days after competitors raised prices.
The country’s biggest mortgage lender, which is owned by Lloyds Banking Group, said interest rates will be reduced for several ranges, including first-time buyers, remortgages, large loans and new build deals.
The move has been described as a “massive mortgage curveball” after other lenders, including HSBC, Santander, and NatWest have been raising rates over the past few weeks.
Speaking to the Newspage news agency, Ranald Mitchell, Director at Charwin Private Clients commented: “Following a series of rate hikes by prominent high street lenders this week, Halifax has just delivered a massive mortgage curveball by announcing a reduction in fixed rates effective from tomorrow.”
However, he noted that uncertainty “continues to grip the UK housing market” as mortgage rates fluctuate.
Mr Mitchell continued: “In a tumultuous turn of events, the UK housing market finds itself ensnared in a whirlwind of uncertainty as mortgage rates continue to oscillate unpredictably.
“This unexpected move has left consumers and industry professionals alike in a state of disarray, grappling with the perplexing question of what direction the market will take next.
“The chaos, conflicting signals and mixed messages are further fueling the prevailing sense of unease and instability within the housing sector.”
Meanwhile, Rohit Kohli, director at The Mortgage Stop described the step as “refreshing” to see one of ‘Big Six’ lenders taking a more “pragmatic” approach.
He said: “After a week of lows, Halifax has delivered a high. We’ll have to wait and see what these reductions look like but this news from Halifax will give a small sigh of relief to borrowers who have been watching rates go upwards this week.
“This just underpins how unstable and unpredictable the UK mortgage market is at the moment.”
Average mortgage rates have been increasing by the day since the Bank of England’s recent decision to maintain the Base Rate at 5.25 percent.
According to data from Moneyfactscompare.co.uk , the average two-year fixed residential mortgage rate today hit 5.74 percent, up from an average rate of 5.72 percent on the previous working day.
Meanwhile, the average five-year fixed residential mortgage rate increased to 5.31 percent today, up from 5.3 percent yesterday.
Michelle Lawson, Director at Lawson Financial said: “The mortgage market appears to have left the realm of reason.
“The messages emerging from lenders are way beyond mixed. Whilst rate reductions are good, they are only good if they last and are not countered by a rise tomorrow. This is less a rollercoaster than a ghost ride at the moment.”
