Mortgage costs are back on the rise after two successive quarters in which there were a number of cost and rate reductions in the residential market. That is according to recent figures from Mortgage Brain.
Its product data analysis, which provides a breakdown of all main products types in the UK mortgage market for a repayment and calculated by cost per £000, revealed that the price of the most popular two, three and five-year mortgages has increased over the past three months.
For example, the cost of a 70% and 80% loan-to-value (LTV) two-year tracker has increased by 4% since the start of August 2018, while its 60% and 90% counterparts have increased by 3% over the same period.
Based on a £150,000 mortgage, borrowers looking to take out one of these mortgages now face a yearly increase of up to £288.
What’s more, as of November 1 2018, with a current rate of 2.27%, the cost of a 60% LTV five-year fixed mortgage is now 2% higher than it was in August 2018, while an increase of up to 1% in cost has been recorded for some two, three and five-year fixed mortgages.
Mortgage Brain’s longer-term analysis also shows a number of cost increases compared to November last year – the first time in many months.
The cost of the 70% two-year tracker, for example, is now 5% higher than it was this time last year, and a 2% increase in cost has been recorded for some two and five-year fixed rate mortgages as well.
Mark Lofthouse, chief executive officer of Mortgage Brain, commented: “With the Bank of England maintaining the base rate at 0.75% for the third consecutive month it’s looking more and more likely that any future rate increases will be at a slow and gradual pace.”
“A lot of the movement that we saw in our latest product analysis has happened since the start of September, however, so once again, the UK mortgage market could be on the verge of change where we revert back to seeing a period of increases in the cost of residential mortgages.”