With effect from tomorrow (Thursday 4th January 2024) HSBC has made a number of changes to its residential and buy-to-let (BTL) mortgage product ranges.
The reductions bring its 5-year fixed rate for remortgage customers below 4% with a headline rate of 3.94% for those borrowing up to 60% of the property value.
In addition, the 2-year fixed rate for remortgages will dip below the 4.50% threshold for the first time since early June last year, with the headline rate hitting 4.49%, again for those with at least 40% equity in their home.
Those looking to fix longer term will be able to switch to a 10-year fixed rate starting from as little as 3.99%.
Existing BTL customers switching or borrowing more will see 2-year and 5-year fixed fee savers at 60%, 65% and 75% LTV decreased, along with the lender’s 2-year and 5-year fixed standard products.
In its BTL purchase and remortgage range, HSBC’s 2-year and 5-year fixed fee saver and fixed standard products will also see reductions across multiple LTV brackets.
Nicholas Mendes, mortgage technical manager at John Charcol, said: “HSBC are the latest high street lender to reprice following similar changes in the market in recent days.
“HSBC have generally remained consistently among the best buys – but following recent changes over the past fortnight they have slipped slightly lower than we would expect them to be.
“This latest move will no doubt move them amongst the Nationwide, Halifax, Virgin and Barclays rates.
“As been noted in the past few days lenders will be looking to capitalise on the pent-up purchase demand and those coming to the end of their fixed rate in the first half of 2024, so we should expect to see continuous battle amongst lenders.”
David Hollingworth, associate director at L&C Mortgages, added: “These cuts are just the latest salvo in an increasingly fast-moving market. These rates are offering some of the lowest rates since the spike in rates last summer.
“Although borrowers coming to the end of their current fixed rate this year will still be looking at a rise in payments, these new lower rates will at least take some of the sting out of the inevitable rise.
“HSBC’s move is notable in that its rates are on offer to those borrowers looking to remortgage, a departure from the recent trend of pricing favouring homemovers.
“With large numbers of borrowers anxiously approaching the expiry of a fix taken during the ultra low rate period, this is a welcome move and hopefully a signal for more lenders to follow suit, improving options for those facing payment shock.
“These cuts follow hot on the heels of New Year improvements by Halifax and others will be bound to follow suit.
“We thought the New Year would start with a bang and that’s proving to be the case.”
Danny Belton, head of lending at Mortgage Advice Bureau, said: “The launch of a host of new lower rates is a welcome New Year’s gift to those looking to buy or remortgage, especially after the typically expensive festive period.
“The drop we’ve seen in mortgage rates is due to swap rates falling and lenders passing on the reductions to customers.
“This could be a sign of things to come, and we could see more lenders reduce rates in the coming days and weeks.”
“Although this is unequivocally good news for the millions of homeowners who will be looking to remortgage or buy this year, the lowest rates, such as a sub 4% interest rate, will mostly be for those with a larger deposit.
“For first-time buyers, and those with a lower amount of equity built up, rates remain high.
“As the year progresses, we’re hopeful that lenders will start to reduce these so that first-time buyers can make homeownership a reality.”
