Tag: Banks

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UK house prices fall as lenders raise mortgage rates

House lenders increase rates

House prices declined in April 2024, with affordability pressures persisting for potential buyers, as reported by Nationwide.

The UK’s largest building society reported a 0.4% decrease in house prices compared to the previous month. The average cost of a home now stands at £261,962, which is 4% lower than in the summer of 2022 peak.

According to the report, the increase in borrowing costs was a significant factor in the recent drop in prices.

In recent days a string of lenders raised rates on new fixed-rate mortgage deals.

The rise was driven by expectations that the Bank of England (BoE) would implement fewer and more gradual interest rate reductions.

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UK mortgage rates fall in January 2024

Mortgage rates down

Mortgage lenders have started 2024 by cutting interest rates.

The UK’s biggest lender, the Halifax, has cut some interest rates by nearly a full 1%, with other lenders expected to follow suit. HSBC has announced it will also make cuts in January.

Halifax is reducing its rates, with interest on a two-year fixed deal being cut by up to 0.83%. HSBC is due to reduce rates on its two-year fixed rate for remortgages (for someone with at least 40% equity in their home) falling below 4.5% for the first time since early June last year.

Mortgage rate chart October 2021 – January 2024

The Bank of England’s (BoE) benchmark interest rate has been held three times at 5.25%, analysts now expect the next move to be down.