Halifax throws lifeline to first-time buyers with new rate cuts

Halifax have this afternoon announced that, from Friday, 6th October, they are reducing their fixed rates again, with one broker describing the rates as “a lifeline for first-time buyers”. The full product changes can be found here. Highlights: 

• 5-year £999 fee 5.72% up to 95% LTV
• 5-year £999 fee 4.85% up to 75% LTV 
• 5-year no fee 4.96% up to 75% LTV
• 2-year £999 fee 5.32% up to 60% LTV

Darryl Dhoffer, founder of Bedford-based The Mortgage Expert, said: “This is a lifeline for the first-time buyer market, as those with 5% deposits can now obtain a rate of 5.72%. I have not seen a sub-6% deal with a 5% deposit for some time. Long may this continue. Consumers who are still hesitant should grab these deals now, as we all know how quickly things can change.”

Other brokers welcomed the latest cuts from the UK's biggest lender. Riz Malik, director of Southend-on-Sea-based independent mortgage broker, R3 Mortgages, said: “Halifax have come out fighting with their new wave of rate cuts as if they wanted to remind us they are the UK’s biggest lender. Lenders want to lend and we are seeing this with continued rate cuts and criteria expansion. Hopefully this will inject some confidence into the market, which it desperately needs.”

Malik's optimism was shared by Stephen Perkins, managing director at Norwich-based Yellow Brick Mortgages: “Following earlier announcements of rate reductions from Coventry Building Society and HSBC, the UK's largest mortgage lender is now doing the same as lenders continue to compete for market share. Very welcome news for all homeowners.”

Lewis Shaw, founder of Mansfield-based Shaw Financial Services, added: "While these rate reductions only knock small margins off, it's still a step in the right direction. It's not going to set the world alight and solve all the mortgage and property market woes but it's undoubtedly better than rates moving in the opposite direction."

Jamie Lennox, director at Norwich-based mortgage broker, Dimora Mortgages, agreed with Shaw: “The scrap is well and truly on for the lenders heading into the last quarter of the year, as they chase their tails to meet lending targets for 2023. Unfortunately, these reductions are weak jabs that won't excite the crowds to rush out and get a mortgage. We still need to see a challenger step up with knock-out power reductions to entice potential buyers to return to the housing market.”

Meanwhile, Michelle Lawson, mortgage and protection adviser at Lawson Financial, was also upbeat: “This is great news for consumers and shows confidence is growing in the market and lenders want to lend. It is more important than ever before for consumers to speak to good brokers who will constantly monitor the marketplace to ensure they get the best rates.”

But Gareth Davies, director at Southampton-based broker, South Coast Mortgage Services said he would like to see more cuts on remortgages, too: “Rate reductions are always welcome, but in a world where the purchase market is struggling, dropping purchase products only won't change things for many. Get the remortgage products down, too, Halifax.”

Charles Breen, Founder & Director at Montgomery Financial ended on a positive note: “This is a sign of the seismic shift in lender mentality we have witnessed over the past few weeks. They have gone from cowering to lend to now being aggressive and looking to grab market share. It's a good sign for the coming months as lender and hopefully consumer confidence returns to the housing market, though we are already seeing green shoots of this happening.”

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