𝓤𝓷𝓲𝓽𝓮𝓭 𝓝𝓮𝔀𝓼

Two major lenders have slashed their mortgage costs, offering fresh hope of cheaper loans for house hunters.

Skipton Building Society and Barclays Bank made the move on Tuesday, putting pressure on rivals to follow suit.

Barclays cut rates on more than 20 home loan deals, though the best cuts were for those who have significant equity in the house.

A two-year fixed deal with a 60 per cent loan-to-value rate on the home falls from 4.95 per cent to 4.6 per cent.

For a 70 per cent loan-to-value over two years, the rate falls from 5 per cent to 4.73 per cent.

Skipton said it had cut rates across its two-year fixed deals by up to 0.27 percentage points.

Jen Lloyd, head of mortgage products and propositions at Skipton, said: “Following the reductions we made earlier this month, we’re pleased to be able to cut rates further. While falling rates offer encouraging signs for the market, a degree of caution remains important. Conditions continue to be volatile amid ongoing global conflicts and broader economic uncertainty, and it’s too early to say whether this marks a sustained downward trend.

“Against this backdrop, recent easing in swap rates has enabled us to pass on additional savings through our mortgage pricing. This is a welcome development for existing homeowners and prospective buyers alike, providing some much‑needed relief and a potential boost for homebuyers at a time when affordability remains under pressure. We’ll continue to monitor developments closely and respond responsibly where we can.”

Other lenders may be waiting to see what the Bank of England does with interest rates when its Monetary Policy Committee meets at the end of April.

Last time it held base rates at 3.75 per cent, a cautious move reflecting uncertainty about inflation since the Iran war began.

Some economists think that if the conflict ends, inflation should be a short-lived affair, allowing the Bank to cut rates and mortgage lenders to follow suit.

Peter Stimson, director of mortgages at the lender MPowered said: “The good news is that lenders are reacting to the recent fall in swaps rates, which lenders use to price their fixed rate mortgages, and bringing out lower cost products. The bad news is that swap rates remain around 70bps (basis points) above the low point seen before the start of the Iran conflict. They may still go either way, depending on how much the longer the crisis remains unresolved.”

He added: “So while fixed interest mortgage rates are getting cheaper, they are still relatively expensive compared to six weeks ago. Borrowers may want to consider their options, rather than fixing at what could still be a relatively high point of the market.”