Average 2 year fix now 5-6%

richardajh

I'm on a 2 year fix (1.17%) which ends at the end of Feb. I owe £150K and have over 60% equity. Today my Broker recommended a 5.45% fix which I'm going to apply for as a contingency and at the time if I can get a BRT, for 3ish % I might go with that.  If I'd been a bit more organised I could have got a fix for 3.24% at end of August :-( 

simon_or

Nothing wrong with your plan but the BR itself is going to be 3% ish in Feb, let alone a BRT.

richardajh said:

I'm on a 2 year fix (1.17%) which ends at the end of Feb. I owe £150K and have over 60% equity. Today my Broker recommended a 5.45% fix which I'm going to apply for as a contingency and at the time if I can get a BRT, for 3ish % I might go with that.  If I'd been a bit more organised I could have got a fix for 3.24% at end of August :-( 

raf300

We are in a slightly different situation and my fault for not acting sooner as I didn’t think it would get this bad so quick for mortgage rates. 

We have a lifetime tracker 1.79% plus base so currently at 4.04% and  owe £60k,  which is not a lot compared to others. 

We have been offered 5.34% (2yr fix) which is the best rate with our current lender. So increase of £40 a month. 

Is this good for peace of mind ? 

I am not sure if the base rate will reach 4%to 5% in 2023 and how long it will stay high. As once inflation is under control and stays to decline, the base rate should stabilise and might go down a touch. 

I think the fiscal plan on Halloween will be key in whether stability willl return to the markets or not. 

However can I or others wait that long to see what happens? 

Saint84

simon_or said:

Average 5 year fix now at 6.19%, the highest since November 2009 according to Moneyfacts. Average 2 yr fix at 6.31%.

https://www.bloomberg.com/news/articles/2022-10-10/uk-mortgage-rates-rise-again-as-kwarteng-bids-to-regain-tory-trust?srnd=premium-uk

5yr SONIA swap rates also rising and now firmly above 5%.

Thanks for this. Are SONIA swap rates an indicator of what long term interest rates are? 

simon_or

I'm not an expert but as I understand it the 5 year SONIA swap rate is a good proxy for bank funding costs for a 5 yr fix. So if it goes up you can expect that to reflect in mortgage rates.

It's not the only component as large high street banks will also have access to much cheaper deposits.