Many of the country’s major lenders – and quite a few smaller ones, too – have slashed mortgage rates in response to dramatically improved inflation data.

At the end of last week there were circa 30 lenders offering a sub 5.0 per cent fixed mortgage compared to 13 at the start of October. Talk amongst some brokers suggests sun-4.0 per cent may be seen by Christmas.

Amongst the high profile reductions, HSBC has reduced rates for mortgage customers across residential and buy-to-let options. Reductions apply to new and existing customers on two, three and five-year fixes and include rates under 5.0 per cent for those looking to remortgage, customers switching, first-time buyers, purchasers and home movers. Changes have been made to deals between 60 and 90 per cent Loan To Value, and came into effect just before the weekend.

Barclays has announced the first sub-5.0 per cent two year fixed remortgage product for some months – it has up to 60 per cent LTV at 4.98 per cent with a £999 fee.

Halifax has cut its mortgage rates by up to 0.46 percentage points and this includes a five-year fix for borrowers with a 10 per cent deposit which has been slashed by 0.24 percentage points to 4.97 per cent.

On the buy to let front, landlords around the UK received a major boost with the launch of a new wave of competitive products by The Mortgage Works, including a sub-4.5 per cent five-year fixed rate purchase and remortgage product up to 55 per cent LTV with a three per cent fee – a move described by some brokers as indicating ‘buy to let is back’.

Meanwhile brokers have responded favourably to the news that the official Consumer Prices Index inflation figure is down to 4.6 per cent in the 12 months to October, falling from 6.7 per cent in September.

Riz Malik, founder of R3 Mortgages, says: “This is a big drop and takes us back to the levels of October 2021. It is also cooler than expected and this positive economic news should mean we end 2023 with another base rate hold. Expect further fixed rate mortgage rate reductions in the days to come. For borrowers, this news is as good as it gets.”

And Ranald Mitchell, director of Charwin Private Clients, comments: “This significant drop in inflation will come as a huge relief to everyone and we should now expect further mortgage rate cuts in the days to come. Mortgage lenders were already at war with each other on pricing and these inflation figures will only encourage them to go even further, and quicker. It looks like the property market will reignite in 2024.”

The director of Lodestone Mortgages and Protection – Craig Fish – wades in with this: “This better-than-expected inflation data is fantastic. We will now see out 2023 with a base rate hold at 5.25 per cent and an improving rate war from lenders all trying to fill their boots after what has been a disastrous year for their mortgage lending. This will hopefully now help those who need to remortgage and not just those who are purchasing as lenders start to show more support to all borrowers and not just a select few.”

Finally Rohit Kohli, The Mortgage Stop’s director, adds: “Inflation falling so sharply will be a massive boost for mortgage borrowers and the broader property market. With inflation tumbling to 4.6 per cent, major lenders like HSBC and Halifax slashing rates again and the base rate likely to be left on hold, the Chancellor has a golden opportunity to reignite the UK housing market in his Autumn Statement and not just squander it by slashing stamp duty.”