First-time buyer mortgage costs down by a quarter since 2013
Fixed rate mortgages saw a significant drop in costs in the last 12 months compared to five years ago, data found.
Two-year fixed rates saw a 24% reduction in costs, while a five and three-year fixed product came down in costs by 21% and 13% respectively, according to Mortgage Brain’s latest product data analysis.
The technology business said the cost of a 90% LTV two-year fixed is now eight per cent lower than it was this time last year.
And 90% LTV five and three-year fixed rates cost two per cent less than they did at the beginning of January 2018.
The price of a two, three and five year 60% LTV fixed rate product is also down by up to 10% over the same period.
In monetary terms, the eight per cent reduction in cost over the past 12 months equates to an annual saving of £612 on a £150k mortgage.
Compared to five years ago, borrowers face a potential annual saving of £2,214 for the 90% two-year fixed, and £2,052 and £1,152 for the five and three-year products, respectively.
However, Mortgage Brain’s short-term analysis showed little movement with mortgage costs for the majority of mainstream products since the beginning of October 2018.
Of those reviewed, only a two year tracker saw a movement in cost with a 60% LTV product down by 0.5% and a 70% and 80% LTV product up by the same amount.
Mark Lofthouse, CEO of Mortgage Brain, said that while there is little to get excited about in terms of rate and cost movement over the past three months, the UK mortgage market has shown some big improvements over the past few years.
He added: “With mortgage costs down by up to 24% compared to January 2013, there are still plenty of good deals out there for first-time buyers and those looking to remortgage. Last year saw costs and rates fluctuate, however, and I expect more of the same for 2019.”