Mortgage shelf-life has dropped to 16 days, down from 36 days the previous month, according to the latest Moneyfacts UK Mortgage Trends Treasury Report data.
Research found that average 2-year and 5-year fixed mortgage rates saw their biggest month-on-month drops in nearly six months, falling by 0.13% and 0.10% to 5.39% and 5.22% respectively.
The average 2-year fixed rate decreased significantly, by 0.37% from 5.76% to 5.39%, bringing it closer to the lower 5-year rate, with the gap now at 0.17%.
Product choices for mortgages rose to 6,684 options, up from last year and the highest since February 2008.
Meanwhile, the average 2-year tracker rate fell to 5.18%.
Rachel Springall, finance expert at Moneyfacts, said: “The rate cutting momentum was prevalent during February, with the average two- and five-year fixed rates seeing their biggest cuts in almost six months.
“Such fierce competition in the aftermath of a typically subdued time of year, showed a mix of moves, but it led to the average shelf-life of a mortgage plummeting to 16 days at the start of March, down from 36 days at the start of February.”
Springall added: “The churn of ranges and rate moves circulated around swap rate volatility, but also due to a drop to the Bank of England base rate near the start of the month.
“Lenders typically act within a couple of weeks of any fierce rises or falls to swap rates.
“However, it is uncertain whether the rate cutting sentiment will be sustained in the weeks to come, particularly by significant margins, but the millions of borrowers due to come off a cheap fixed deal will be hoping for further falls, without doubt.”
Borrowers with little equity or a small deposit benefited from lower rates, with the average 2-year fixed rate at 95% loan-to-value seeing a drop of 0.11%.
Springall added that it’s positive to see the rate drop further below 6% for those who may need to opt for a short-term fixed mortgage due to their circumstances.
She highlighted that the average ‘revert to’ rate or standard variable rate also declined to 7.68%, encouraging borrowers to remortgage rather than defaulting to a standard rate.
