A number of major British banks and building societies reduced their mortgage rates last week, responding to market conditions just days after previous reductions took effect.

Santander, HSBC UK, Barclays, Skipton Building Society, and Virgin Money all modified their mortgage products, reflecting increased rivalry among lenders.

Data from financial research platform Moneyfacts showed the typical two-year fixed homeowner mortgage rate stood at 5.83% on Wednesday morning (April 22), compared to 5.87% on Tuesday (April 21).

Santander unveiled additional reductions

The bank implemented its second set of cuts during April, announcing reductions of as much as 0.25 percentage points effective from Friday (April 24). The adjustments affected first-time purchasers, those moving home, and customers looking to remortgage.

Featured offers included:

A 98% loan-to-value “My First Mortgage” product now priced at 5.60%

A three-year fixed option requiring just a 5% deposit, available at 5.55% with no completion fee and £250 cashback

A two-year fixed rate at 4.80% for those with a 15% deposit, accompanied by a £999 fee plus £250 cashback

A five-year fixed product at 4.98% for 15% deposits, offering no fee and £250 cashback

HSBC UK updated its mortgage selection having reduced rates during the preceding week, with changes affecting both purchaser and remortgage products.

Barclays and Skipton Building Society had already reduced their rates earlier in the week, while Virgin Money applied cuts across its residential and buy-to-let range.

What prompted the rate adjustments?

Mortgage pricing, which responds to swap rate movements, had started to decrease, enabling lenders to pass on some savings to customers.

Simultaneously, international instability, notably tensions in the Middle East, persisted in generating uncertainty and maintained forecasts for elevated interest rates, restricting the extent of possible reductions.

According to Moneyfacts at that point:

The typical two-year fixed mortgage rate stood at 5.83%

The typical five-year fixed rate was 5.73%

Both showed modest daily decreases, though they remained considerably higher than levels recorded in early March, when two-year fixes averaged 4.83% and five-year products sat at 4.95%.