Mortgage Brain has revealed that the cost of mortgages is on the rise with the majority of mainstream residential mortgages increasing during the last three months of 2017.
The firm’s latest quarterly product data analysis – as of 1 January 2018 – shows, for example, that the cost of a three year fixed rate mortgage with a 60% LTV has gone up by 5% over the past three months. Similarly, a 70% LTV two year fixed product now costs 4% more than it did at the start of October 2017.
The analysis – a breakdown of all main product types in the UK mortgage market for a repayment mortgage and calculated by cost per ‘£000’ -, also shows a 3% rise in the cost of a 60% and 80% two year fixed, and an 80% LTV two year tracker.
Marginal increases of around 2% over the last quarter of 2017 have also been recorded for 70% and 80% LTV three year fixed mortgages, and a 1% increase for a 90% LTV two year fixed, a 60% two year tracker and a 70% five year fixed mortgage.
In monetary terms, the 5% increase for the 60% three year fixed equates to an annualised increase of £360 on a £150k mortgage, and a £252 annualised increase for the 70% two year fixed product.
Mortgage Brain’s longer term analysis, however, continues to show strong year on year reductions spanning the past three years. The cost of a 90% two year fixed product, for example, is now 13% lower than it was in January 2015. A 60% and 90% LTV five year fixed are both 9% cheaper, while a 60% two year fixed and tracker are 8% and 5% lower respectively.
Mark Lofthouse, CEO of Mortgage Brain, said: “It looks like we’re starting to witness the effects of November’s interest rate rise and previous predictions with slow and steady cost increases being recorded month on month since October 2017.
“So far, the increases have been marginal; however, with further rate increases predicted, we could be starting to see a shift in change in terms of mortgage cost movement compared to the past few years. Our analysis at the end of the first quarter of 2018 should reveal more.”