The average two-year fixed-rate homeowner mortgage rate has reached its highest level in 15-years in as a result of last autumn’s mini budget.
Moneyfactscompare.co.uk said that the typical two-year fixed-rate residential mortgage has now hit 6.66% on Tuesday, up from 6.63% the day before and the last time the rates were higher was in 2008.
Rachel Springall, a finance expert at Moneyfactscompare.co.uk, said: “Borrowers may be disappointed to see the average two-year fixed mortgage rate has risen to its highest point in 15 years.
“Those borrowers concerned over (the) affordability of a deal might pause their homeownership plans, or indeed park the idea of refinancing.
“After the fiscal announcement, fixed mortgage rates rose sharply, which resulted in a worrying environment for potential buyers and those needing to remortgage.
“There are still some competitive deals out there for consumers to choose from, so it’s vital that borrowers seek advice to go through their options. Anyone struggling to pay their mortgage, or reaching the end of a low fixed rate, would be wise to speak to their lender immediately.”
Riz Malik, founder and director at R3 Mortgages said, “666 is the number of the devil, and with average 2-year fixed rates hitting 6.66%, many homeowners will be in a personal hell.
“The government and the Bank of England are equally to blame for this current mess. As rates surpass the rule of Truss and Kwarteng, it’s only fair that Sunak, Hunt, Bailey and the whole MPC suffer the same fate.”
Graham Cox, founder at SelfEmployedMortgageHub.com warned to expect the “mother of all house price crashes” as result.
Cox said, “Expect the mother of all house price crashes if these rates or higher remain in place throughout the rest of the year.
“Which is likely without some positive news on inflation very soon. Homeowners, faced with a huge spike in borrowing costs when they come to remortgage, will have no option but to sell up.
“When everyone is trying to jump ship at the same time, it can only lead to one thing: slashed house prices.
“Andrew Bailey and the rest of the Bank of England MPC have been asleep at the wheel and should hang their heads in shame. They had one job to do and failed miserably.”
Leave a Comment