Home Property Finance & InvestmentMortgages The ‘dominos are starting to fall’ as TSB increases residential rates

The ‘dominos are starting to fall’ as TSB increases residential rates

by Seamus Doherty Property Reporter
21st Feb 24 12:06 pm

TSB has just announced increases to their Homebuyer range of mortgage products and some remortgage deals, up by 0.30% depending on the product. Newspage asked brokers for their views on this repricing, how it fits with  current market conditions and whether it will slow down the recent uplift in mortgage activity?

Lewis Shaw, owner and mortgage expert at Shaw Financial Services said, “It seems as though the dominos are starting to fall, with one lender after another increasing rates.

“First Santander, then Coventry and now TSB. As swap rates rise, the cost of funding fixed rate mortgages increases and shows up as lenders repricing upwards so we may see a few more large lenders follow suit in the coming days.”

Justin Moy, managing director at EHF Mortgages said, “Unfortunately, TSB are just one of many lenders forced to increase rates given recent increases in Swap rates, pouring some cold water onto the property and mortgage market, for the short term at least.

“Perhaps this will allow a few lenders to catch up with their outstanding application numbers, ready for the inevitable drop in rates we hopefully will see soon.”

Gary Bush, financial advisor at MortgageShop.com said, “2024 started so well and looked like the UK fixed rate mortgage market was going to calm down with rate decreases all lining up nicely.

“Lenders are now all following their competitors like lemmings with TSB the latest lender to introduce notable increases to their rates. It’s tragic news for the first-time buyers who came fresh out of the new year blocks with plans to finally get on the property ladder.

“The horizon looks to be less rosy for the next couple of weeks, until the March Bank of England monetary policy committee meeting, which will inevitably bring a base rate hold or if we all pray to our respective idols even a marginal .25% decrease.

“All analytical eyes are on this situation to try and wrestle some sanity from the past 20 months.”

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