New fixed rate first time buyer mortgages are £72 a month cheaper than a year ago

The average interest on a five-year fixed rate mortgage rate has dipped below 5 percent.

The figure comes from Rightmove’s weekly mortgage tracker which puts the average five-year fixed mortgage rate at 4.99 percent.

This is down from 5.68 percent a year ago, but still well above the record lows of less than 1.5 percent that were available in 2021.

The average two-year fixed mortgage rate is now 5.37 per cent, which is down from 6.17 percent on a year ago.

The average monthly mortgage payment on a first-time buyer type property which is currently £227,757 is estimated at £1,131.

This is down by around £72 on this time last year.

This is based on someone taking out an average five-year fixed rate with a mortgage loan to value of 85 percent repaying over 25 years.

Last week, the chief executive of Lloyds Banking Group warned home buyers that a return to ultra-low interest rates is unlikely.

Charlie Nunn said: “We've just come off a decade where mortgages have been in the 1.5-2.5 percent range.

"The expectations the market have is that interest rates probably won't get below 3.5 percent.

“And that means mortgages, or the new normal for mortgages, will be in that 3.5-4.5 percent range, not 1.5-2.5 percent.”