Mortgage rates drop but deals are disappearing fast -...

Mortgage rates may be dropping but buyers need to act fast as product shelf-life is also falling.

Moneyfacts data shows the average shelf-life of a mortgage deal fell to 17 days this month, down from 30 days in June.

It comes as the average two- and five-year fixed mortgage rates have fallen, halting five months of consecutive rises and giving a boost to homebuyers.

Average mortgage rates on the overall two- and five-year fixed rate deals fell month-on-month by 0.18% and 0.15% respectively, halting five consecutive months of rises. These rates are now at their lowest level since March 2024.

The overall average two- and five-year fixed rates fell between the start of July and the start of August, to 5.77% and 5.38% respectively, Moneyfacts said.

Product choice overall also fell slightly month-on-month, to 6,657 options.

Rachel Springall, finance expert at Moneyfacts, said: “Borrowers will be pleased to see that fixed mortgage rates fell month-on-month, halting five consecutive months of rises.
“Lenders re-priced their deals with vigour during July due to falling swap rates, and the volatility within the mortgage market was made clear by the notable drop in the average shelf-life of a mortgage to just 17 days, down from 30 in June.

“There are expectations for rates to fall further in the weeks to come, particularly as the market reflects on the 0.25% base rate cut, the first cut in over four years.

“A variety of lenders priced their lowest rate deals even lower still over the past few weeks, leading to the return of sub-4% fixed rates towards the end of July, but borrowers must look beyond the initial rate and assess any mortgage based on the overall true cost.”