Confidence rising as mortgage choice for buyers hits recent high

Mortgage availability has risen for the fifth consecutive month according to respected market monitor Moneyfacts.

With 3,532 products on offer, this is the highest total of mortgage products the service has recorded since 5,222 products were available in March of last year. 

Over the last two months alone availability has risen by 639 products, and over the last six months product numbers have increased by 1,120.

But deals are changing all the time and the average shelf life for all mortgage deals has fallen to only 26 days – the lowest on Moneyfacts’ records since May 2017. 

“This demonstrates how fluid the sector is as providers amend their offerings with regularity, leaving borrowers with little time to secure their chosen product” says the service.

Eleanor Williams, Finance Expert at Moneyfacts, adds: In the last six months product numbers have risen by 1,120 products, which, when compared to the increase of only 165 over the six months between July 2020 and January 2021, demonstrates how significant product growth has been and that lenders are returning with confidence. 

“Growth in product availability appears to follow demand, as separate data from UK Finance indicated that purchase numbers from the final quarter of 2020 were at a level not seen since 2007 and demand may remain high due to the Budget announcement on borrower support.”

Williams continues: “Borrowers with varying levels of equity or deposit may be pleased to note continued improvements in product availability across the loan-to-value tiers, except for 95 per cent LTV where there are still just five specialist deals on offer. 

“However, this may soon change with the Government-backed mortgage guarantee scheme from April where, up to this point in time, first-time buyers may have felt neglected. In 2020 mortgage products for those with small deposits nosedived and saving for a bigger deposit continues to be hampered by rock-bottom savings rates, while demand remains high for the limited number of affordable properties.”

Growth in choice is positive but average rates have risen alongside the uplift, explains Williams.

The two-year fixed rate for all loan-to-value products at 2.57% is the highest since June 2016 while the five-year equivalent has now risen to 2.75 per cent - the highest since November 2019. 

“Those now searching for a new mortgage or progressing an application, in light of the extension to the stamp duty holiday, may do well to secure the advice and up to date market knowledge of a qualified adviser” she concludes.