Average mortgage rates have dropped significantly since last year, with five-year fixes hitting a low not seen since before the disastrous mini-budget.

Rightmove’s latest data reveals some incredibly attractive deals for those looking to buy a home. The most significant savings are on five-year fixed-rate mortgages at a 60% loan-to-value (LTV). This means if you have a 40% deposit, you could secure a rate as low as 3.77%! This is the lowest rate offered since before the mini-budget sent the market into a tailspin.

Here’s a breakdown of the average rates and cheapest deals available right now:

60% LTV (40% deposit):

• Five-year fix: Average rate 3.97% (down from 5.33% last year), with rates starting from just 3.77%.
• Two-year fix: Average rate 4.3%, with rates starting from 4.12% (down from 5.96% last year).

75% LTV (25% deposit):

• Five-year fix: Average rate 4.45% (down from 5.52% last year), with rates starting from 3.93%.
• Two-year fix: Average rate 4.79% (down from 6.12% last year), with rates starting from 4.37%.

Higher LTVs (smaller deposits):

Even if you have a smaller deposit, there’s good news. Rates have fallen across all LTVs. For example, the average five-year fixed rate at 90% LTV is now 4.99%, with rates starting from 4.55%. This time last year, the average rate was a hefty 5.85%!

What’s driving this downward trend?

Experts suggest a number of factors are contributing to falling mortgage rates, including a cooling housing market and increased competition between lenders. This means now could be the perfect time to lock in a great deal on your mortgage.