The average five-year fixed-rate homeowner mortgage is inching closer to dipping below the 6 per cent mark, as indicated by data from a financial information website.

Across all deposit sizes available in the market, the mean five-year fixed-rate homeowner mortgage now stands at 6.03 per cent, a slight decrease from the 6.04 per cent recorded on Tuesday, as reported by Moneyfacts.

The last instance when the average five-year fixed-rate deal was below 6 per cent dates back to July 3, when it rested at 5.97 per cent.

In comparison, the typical two-year fixed residential mortgage rate currently registers at 6.53 per cent, marking a marginal reduction from the 6.54 per cent recorded on Tuesday.

Several major mortgage lenders have reduced their rates this week, even though the Bank of England retained its base rate at 5.25 per cent last Thursday.

Homebuyers with larger deposits now have the option of selecting five-year fixed-rate mortgages with rates falling below 5 per cent.HSBC UK, for example, lowered various mortgage rates by up to 0.16 percentage points on Wednesday.

Among the offers, HSBC UK presents borrowers with a 40 per cent deposit a five-year fixed-rate mortgage at 4.93 per cent, accompanied by a £999 fee. This rate is 0.96 percentage points lower than that observed in July. Additionally, HSBC UK has introduced £350 cashback on specific five-year fixed rates for those in the process of moving homes.A spokesperson from HSBC UK stated, "Following review, we are pleased to announce more cuts to mortgage rates across our residential mortgage range for new and existing customers.

"On Tuesday, Santander UK also reduced selected mortgage rates by up to 0.50 percentage points. Among the new deals is a five-year fixed rate at 4.95 per cent, accompanied by a £999 product fee for individuals with a 40 per cent deposit. This rate has decreased from the previous 5.10 per cent.Matt Smith, a mortgage expert at the property website Rightmove, commented, "Following the positive news on inflation and the Bank’s decision to hold the base rate, we have seen swap rates, the underlying costs of fixed-rate mortgages, stabilise."

"For those considering a mortgage soon, the prevailing market sentiment is that the base rate has likely reached its peak, although there remains a diminishing risk of one more increase this winter."

"As we approach the final quarter of this year, we are likely to witness sustained stability in the mortgage market, with rates continuing to gradually decline and more lenders expected to offer sub-5% deals."

"After a tumultuous 12 months for mortgage rates since the mini-budget, this news will come as a welcome relief for homebuyers during a challenging adjustment from the prolonged period of historically low rates."

[Source: City A.M.]