Property & Mortgage Outlook – August 2021


With the continued success of the vaccine roll out in the UK and the lifting of lockdown restrictions, the economy is recovering quicker than expected. Fuelled by a shortage of stock and a general feel good factor, the housing market also appears to be in rude health.

Headline-grabbing mortgage rates have been coming thick and fast in recent weeks. It started with the first sub-1% deal in several years and has continued with lenders launching their cheapest home loans ever. This indicates an appetite to lend from mortgage providers and reflects an ability to price low while we remain in a low interest rate environment.

Best Buys* (as of 3 August 2021)

Initial Rate Description Subsequent Rate Overall Cost For Comparison (APR) Early Repayment Charge Max Loan Fee
0.91% 2 Year Fix 3.59% 3.20% 1.5% Year 1, 0.75% Year 2 £1m £1,499
0.99% 5 Year Fix 3.59% 2.60% 3% Years 1-2, reducing to 0.75% by Year 5 £1m £1,499
1.19% 2 Year Fix Offset 3.59% 3.20% 2% Year 1, 1% Year 2 £1m £999
1.19% 2 Year Fix – BTL 4.74% 4.50% 1.5% Year 1, 1% Year 2 £1.5m 2% of loan


As lenders compete for market share for the first time in the UK mortgage market, there are some five year fixed rates below 1%. But with two year pricing even lower, rates not likely to increase during the two years, many are still choosing the flexibility of shorter term arrangements.


Due to the current overseas travel restrictions there has been an increase in interest on holiday home purchases in the UK. There are many options to choose from: there are market leading residential products available for clients only looking to rent their properties out for up to sixteen weeks, highly competitive options for full time holiday lets and even the option to raise the funds to renovate properties that require updating before they are ready for rental. Due to the shortage of available property it is advisable to have an ‘Agreement in Principle’ before making an offer.

Whether you are coming to the end of your mortgage product or keen to compare your current rate to the best available elsewhere, please contact your adviser who can put you in touch with our mortgage partners.

* Lending criteria restrictions apply to all products, always seek independent advice.

Articles on this website are offered only for general information and educational purposes. They are not offered as, and do not constitute, financial advice. You should not act or rely on any information contained in this website without first seeking advice from a professional.

Past performance is not a guide to future performance and may not be repeated. Capital is at risk; investments and the income from them can fall as well as rise and investors may not get back the amounts originally invested.

Your home may be repossessed if you do not keep up with payments on your mortgage.

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Source: Professional Mortgage Services


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