Latest data from Moneyfacts shows that the average two-year fixed rate currently stands at 2.50 per cent, down slightly from last week’s figure of 2.51 per cent.
The average rate has dropped progressively since last Friday, but taking a weekly view, has bobbed around for some time. At the start of the month it hit 2.53 per cent, not far off the 52-week high of 2.55 per cent recorded in August this year.
Moneyfacts finance expert Darren Cook says: “What we’ve seen in the past is happening again… a lot of lenders are trying to push through to their targets before the end of the year.
“This week’s drop is very small, but it’s an indication of a competitive market, even amid the risk outside of the mortgage environment [represented by Brexit], which you might expect to push rates up.
“But with margins being so tight, lenders are coming up with more incentives than price, so we’re unlikely to see excessive cuts” adds Cook, pointing to Moneyfact’s recent report that showed that cashback deals are on the rise.
“Lenders have to make their proposals appetising for mortgage holders… they are aware that retaining the business they already have is vital,” he concludes.