10-year mortgage rates ‘have started edging up’

Average rates on 10-year fixes are still lower than they were a year ago
Average rates on 10-year fixes are still lower than they were a year ago

Home owners looking to lock into a mortgage deal for the next decade will find the average rate on a 10-year fixed-rate has started to creep up from an all-time low.

At the start of February, the average 10-year fixed-rate mortgage on the market had a rate of 2.96%, according to Moneyfacts.co.uk.

This was the lowest rate ever seen for this type of deal on records it has going back to 2007.

But now, just a few weeks later, the average rate has increased back up over the 3% mark, and stands at 3.05%.

Average rates on 10-year fixes are still lower than they were a year ago however, standing at 3.2% in February 2017.

The recent rise comes amid speculation over possible future increases to the Bank of England base rate.

Earlier this month, Bank of England boss Mark Carney braced borrowers for further and faster interest rate hikes, although he also stressed rises would be limited and gradual.

Rachel Springall, a finance expert at Moneyfacts.co.uk, said: “In times of uncertainty, a decade-long fixed mortgage could be a safe haven for borrowers looking to secure their mortgage payments over the longer term.”

She said: “Lenders are appearing to retain competitiveness and variety over their 10-year fixed deals, to catch the eyes of consumers looking to remortgage or buy a home.

“However, it’s unavoidable that lenders will have to start pricing in fluctuations in long-term swap rates and start to adjust their range, in order to cope with the changing economy.”

Ms Springall continued: “Whatever borrowers decide to do, they could benefit from working out the true cost of any deal.”