Halifax has announced a further round of price reductions on selected 5-year fixed rates from Monday 21st August.
Free UK news agency, Newspage, asked brokers if other lenders are likely to follow suit, and why this has happened despite the fact swap rates have risen over the past few days.
Here’s what they had to say.
Clive Read, owner at Goldmanread:
“As a large national lender, Halifax has the margins and reach to lower rates whilst retaining a profitable mortgage book. Aside from that, as part of the largest banking group in the UK, they need to demonstrate that they are supporting UK homeowners and consumers. Their move is likely to be followed by the other large lenders in this space though we may not see much movement from the smaller players.”
Darryl Dhoffer, mortgage expert at The Mortgage Expert:
“It appears the Halifax is filling up its August mortgage shopping trolley while it can. I’m sure the past few months have been horrendous for new business volumes for many lenders, and they have loan books to fill and shareholders to appease. For those borrowers pondering and thinking these rate drops are the norm, grab them while you can, as they may not be around in a few weeks or months.”
Jamie Lennox, director at Dimora Mortgages:
“It’s great to see the UK’s biggest mortgage lender return with a further reduction on selected products. This is a positive boost for the mortgage and property market given that markets are baking in further base rate increases following core inflation remaining sticky. It’s likely that the speed at which rates went up caused a firm halt in the number of new applications being received and we may now see lenders chasing their tails in the months to come to try and make up for being behind on their targets for the year. Only time will tell, but we hope to see more to follow.”
Lewis Shaw, owner and mortgage expert at Shaw Financial Services:
“Here we go. Halifax is the biggest lender so where they go others tend to follow. More reductions are welcome but let’s not get complacent. This could still be the calm before the storm.”
Peter Stamford, director and lead adviser at Moor Mortgages:
“Halifax is making assertive moves to bolster its mortgage portfolio, a likely response to the subdued business volumes in recent months. With markets anticipating further base rate hikes due to persistent core inflation, the UK’s leading mortgage lender’s rate reductions may be short-lived.
“As the industry sees a slowdown in new applications, other lenders might soon follow Halifax’s lead. Borrowers should seize these opportunities, but with caution, as the financial climate remains unpredictable.”
