Is the mortgage market starting to even out?

The number of residential mortgages available on the market has fallen for the first time since October 2020, Moneyfacts reports.

Following 15 months of improvement in the level of product choice for borrowers, February saw the mortgage availability fall; reducing by 38 deals to 5,356. The small month-on-month reduction in numbers could potentially be a sign of the market returning to a level of stability after a hectic couple of years. However, when compared to two years ago, there are currently 280 more deals on offer than in February 2020.

Additionally, the average shelf life of a mortgage product has increased 50% in the past month. At 42 days in February, prospective new borrowers had 14 more days to secure their chosen deal than they had in January. This timeline extension could suggest that lenders had already made many of their re-pricing decisions in anticipation of the base rate rise in December 2020 and therefore January saw fewer updates made. However, conversely, this lack in activity could be a reflection of lenders holding back on re-pricing decisions in advance of last week’s news, so it may be a different story next month

Regarding rates, this continues the trend for a fourth consecutive month, the overall average two and five-year fixed rates both rose. The average two-year fixed rate for all LTVs has increased by 0.06% to 2.44%, and the five-year equivalent experienced a 0.05% rise to 2.71%.

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