Mortgage market given 'glimmer of hope'

31-Jul-2008

The UK's housing situation has been endowed with "a faint glimmer of hope" as the fixed-rate mortgage market returns to normality, according to personal finance specialist Moneyfacts.co.uk.

A spokesperson for the site says new mortgage borrowers will benefit from lenders' interest-rate cuts on their popular fixed-rate deals.

Looking at average two-year fixed rates over the past few months, the site analysed trends against the volatility of the swap market and found a peak of 7.08 per cent on July 11th.

"Several lenders, such as Halifax, C and G, Nationwide BS and HSBC have trimmed their mortgage rates over the past two weeks, which has resulted in the average two-year fixed rate dropping to the current 6.95 per cent," observed the spokesperson.

The representative went on to note that the main mortgage lenders have a collective average two-year fixed rate of 6.76 per cent.

"It is encouraging that, at long last, lenders are responding to the easing in wholesale borrowing costs and passing a discount on to the consumer," he concluded.

Real estate specialist Savills claimed this week that first-time buyers may not be able to avail of a healthy housing market until the credit crisis "has worked itself out".

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Savills: Mortgage lending won't improve until after credit crisis Long-term mortgage deals mark credit crunch 'flight to safety'

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