Editor's note: This brief was summarised by The Property AI Newsroom from a report by Mortgage Solutions. Read the original article for full details.
Lenders get ahead of Bank of England's MPC with more rate increases
A raft of mortgage rate increases has been announced ahead of Thursday's base rate decision, with hikes from NatWest, TSB and Coventry Building Society among the changes. The moves come as markets price in a greater risk of bank rate staying higher, or moving higher, for longer.
NatWest raises rates by up to 43bps
NatWest has announced increases of up to 43 basis points, affecting new business and additional borrowing products. Its two-year fixed buy-to-let purchase mortgage at 60% LTV with no fee has risen by 30bps to 5.5%, while the £995 fee version is up by the same amount to 5.04%. The five-year fixed equivalents have also risen by 30bps, to 5.36% and 5.24% respectively.
For residential borrowers, the two-year fixed purchase deal at 60% LTV with no fee has risen by 36bps to 5.36%, and the £995 fee product is up 30bps to 5.15%.
Coventry pulls deals and ups rates
Coventry Building Society will withdraw all two-year interest-only fixed rates for new borrowers, excluding offset mortgages, and pull all two-year exclusive rates at 90% LTV for first-time buyers. It will also pull two-year interest-only fixed rates for existing borrowers, except offset deals, and increase all fixed rates for new and existing residential and buy-to-let borrowers.
TSB's second round of increases in a week
TSB has announced rate rises of up to 0.25% on all fixed house purchase and remortgage rates. Across its BTL and portfolio BTL range, all fixed purchase and remortgage rates will rise by 0.2%. This is the second time in a week that TSB has increased pricing.
Skipton and Principality also raise pricing
Skipton Building Society is increasing rates across its entire fixed rate range for new and existing borrowers. Principality Building Society will raise rates across selected residential, new-build, joint borrower sole proprietor (JBSP), buy-to-let and holiday let deals, with pricing rising by as much as 0.4%.
Broker warns market is "moving ahead of the MPC"
Nick Mendes, mortgage technical manager at John Charcol, said the mortgage market was "moving ahead of the MPC". He said the changes were not a reaction to the inflation figure, which showed a 3.1% rise, but due to wholesale funding costs rising for some time.
"Fixed mortgage rates are much more closely tied to swap rates and lenders' funding costs, and those have already moved considerably," he said, noting the breadth of the repricing across new business, remortgages, product transfers and buy-to-let from several lenders at the same time. For borrowers coming towards the end of a fixed deal, he advised securing an affordable option rather than waiting, while keeping it under review.
Source: Mortgage Solutions