Mortgage rates trumped following US elections, brokers say
Donald Trump’s shock win in the US presidential election could see long-term mortgage rates for British homeowners rise within days following a surge in the cost of borrowing for lenders, a broker has warned.
Mortgage broker firm John Charcol is predicting that five-year and 10-year fixed rates will be the first to see prices go up, with lenders expected to start hiking costs later this week.
The price rises will reverse more than a year of lenders slashing mortgage rates in a bid to entice borrowers to remortgage.
But their ability to keep mortgage rates at rock bottom lows is coming to an end, according to the broker firm.
Swap rates, money market rates paid by lenders and which usually influence mortgage rates, have risen sharply since August, with the cost of five-year money more than doubling from 0.43 per cent to 0.9 per cent at the start of November.
Since Trump's surprise win on Wednesday last week, swap rates have spiked - rising on a daily basis.
As a result, some brokers are suggesting now is the time to fix your mortgage.
Emma Coffey, head of Sales at Goldsmith Williams, comments:
“With the market in an uncertain state, it can be useful to enlist the expertise of a reputable broker, who is able to scour the market for the right deal to suit your situation.
“Likewise, a good solicitor can help ensure the often complicated legal aspects of purchasing a property run smoothly and efficiently.
“If you have your heart set on buying a home, the right team of professionals should be able to make the process relatively stress-free, despite the changing market.”
Content correct at time of publication.