The availability of mortgage deals at 95 per cent loan-to-value rose to its highest point in more than two years, research from Moneyfacts has revealed.
The research, Moneyfacts UK Mortgage Trends Treasury Report, found the availability of such higher LTVs had risen to 361 in July 2024, a rise on the 353 products recorded in June.
This represented the highest level of availability since May 2022 when it stood at 369 products.
Moneyfacts finance expert, Rachel Springall, said this was good news for borrowers who have a limited deposit.
“There is lots of room for growth in this area of the market, as it currently represents just 5 per cent of all deals available to borrowers across fixed and variable mortgages,” she said.
“Overall product availability continued to rise, spreading a positive sentiment on mortgage choice for another consecutive month, its highest point in 16 years.”
Mortgage rates
Moneyfacts also reported the average two-year fixed rate across all LTVs rose slightly across July, increasing from 5.93 per cent in June to 5.95 per cent.
A similar increase was seen among the average five-year fixed rate, which rose from 5.50 per cent in June to 5.53 per cent in July.
This represented the fifth consecutive month that average mortgage rates had risen.
While Springall acknowledged this may be “disappointing news” to borrowers, she pointed out that the rises were “modest”.
Product availability
Additionally, Springall said the concerns surrounding mortgage affordability among borrowers remain and pointed out that the government “will no doubt be under the spotlight” to see what plans may be set in motion to support homebuyers and those looking to get onto the property ladder.
“Those borrowers coming off a fixed rate deal this year will note the average standard variable rate is above 8 per cent, so considering a lower rate fixed or tracker mortgage would be wise,” she added.
“There are over 400 different tracker mortgages on the market, and any that track the Bank of England base rate may suit those who believe that base rate will come down before the year is over.
“It is essential that any borrowers who are struggling seek advice from their lender and an independent broker to navigate the latest deals available to them.”
tom.dunstan@ft.com
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