Analysis by Moneyfacts has found that almost 10% of UK mortgage deals have been taken off the market in the past week.
The analysis comes after higher-than-expected inflation figures prompted concern over how much interest rates will increase. The research shows that nearly 800 residential and buy-to-let deals have been pulled. While the number of residential mortgages on the UK market has fallen from 5,385 to 5,012, the number of buy-to-let mortgages has fallen by 405 to 2,343.
Moneyfacts also reports that mortgage rates have increased, with the average rate on a two-year fixed deal rising to 5.38%, and the average rate on a five-year fixed now standing at 5.05%. In May last year, two- and five-year fixed rates stood at 3.03% and 3.17% respectively.
Rachel Springall, Finance Expert at Moneyfactscompare.co.uk, said “Borrowers searching for a new deal may well be concerned about the latest developments in the mortgage market. Over the past few days, we have seen a few lenders withdraw selected fixed products, with some pulling out of the market, at least temporarily. Product choice has started to fall, and as may be expected, average fixed mortgage rates are on the rise. This volatility is down to the concerns surrounding future interest rate hikes, and lenders are reassessing their propositions. Consumers looking to refinance will find rates around 5% on average for a fixed deal, compared to around 3% a year ago. It is vital borrowers seek advice to assess the situation and to find a mortgage that suits their circumstances.”