Brokers anticipate further cuts in January
Homeowner clients looking to remortgage in 2025 may find some relief as two major lenders, Halifax and Leeds Building Society, have announced reductions in their fixed mortgage rates. The moves come amid expectations of increased mortgage activity in the new year, with a predicted rise in both house purchase and remortgage lending.
Starting January 1, 2025, Halifax has lowered rates by up to 0.35% on its 18-month and three-year remortgage products, bringing its lowest rates to 4.22% and 4.41%, respectively. Leeds Building Society followed suit with reductions of up to 0.24% across its offerings.
Current mortgage rates in the UK remain between 4% and 5% for borrowers with solid credit records, with five-year fixed deals generally offering better rates than two-year options. Households with at least 40% equity can access five-year fixed rates as low as 4.08%, translating to monthly repayments of £1,065 on a £200,000 mortgage over 25 years.
The cuts could signal a wider trend, as mortgage brokers anticipate that other lenders may soon introduce similar reductions. Darryl Dhoffer, founder of The Mortgage Geezer, described Halifax’s move as a potential "catalyst" for further cuts.
“Lenders will want to start the new year positively,” Dhoffer said, suggesting more reductions could follow in the coming days.
It’s a sentiment echoed by EHF Mortgages managing director Justin Moy: “The early moves by Halifax and Leeds Building Society suggest a mini rate war will rage at the start of January. With many borrowers seeking new mortgage deals in 2025, January is shaping up to be an ideal time to lock in favourable rates.”
Borrowers are encouraged to act swiftly as competition among lenders may increase, potentially driving rates even lower in the coming weeks.
Want to be regularly updated with mortgage news and features? Get exclusive interviews, breaking news, and industry events in your inbox – subscribe to our FREE daily newsletter. You can also follow us on Facebook, Twitter, and LinkedIn.
