More mortgage deals are currently available to UK homeowners and buyers than at any point in the past nine years, according to new figures.
Data compiled by Moneyfacts for its UK Mortgage Trends Treasury Report shows that 4,460 products are currently available. The figure has increased by 849 over the past 12 months, and by 119 in the last month alone.
Overall, it is the highest total seen since March 2008, when 6,192 such products were available, with a key reason being the increasing competition between lenders.
The report indicates that several new providers have entered the lending market in recent times, while others have revamped their existing ranges to appeal to both new borrowers and switchers.
Lenders are keen to protect their mortgage book against the possibility of losing borrowers when a fixed-rate term ends and they decide not to persist with their standard variable rate (SVR).
As such, lenders are aiming to stay ahead of the curve and ensure that all deals look attractive to borrowers when they begin remortgaging, in addition to enticing new customers.
This is reflected in the report’s findings on average mortgage rates, which fell to new lows in April, with every product seeing a 0.02 per cent reduction.
It means that the average two-year fixed mortgage rate is now at a record low of 2.30 per cent, while the five-year equivalent stands at 2.89 per cent.
The average two-year tracker rate now sits at just 1.91 per cent; the lowest average mortgage rate ever recorded.
Charlotte Nelson, finance expert at Moneyfacts, said that providers today not only need to be price sensitive, but must also offer borrowers a variety of features.
She added: “This allows the customer to almost be able to tailor the mortgage to suit their needs. Given the multiple scenarios lenders now cater for, it is little wonder the market has seen product numbers shoot up."
The report also highlighted a significant change in the type of product being offered today compared with 2008. Nine years ago, only 24 products were available at 60 per cent loan-to-value (LTV), but this has increased by more than 2,000 per cent to stand at 549.
Conversely, in March 2008 there were 575 deals available at 95 per cent LTV, but this has halved to stand at 257 in April 2017 as risk is factored more into lending criteria than ever before.
Charlotte added: “These figures show that we have moved to a more structured market, with the number of deals clearly sorted according to risk and borrowers now rewarded for having extra equity.”
The Mortgage Market Review has also been credited with stabilising the market, by making lending more robust and enabling mortgage providers to focus more on the full length of the mortgage, rather than the short-termism often seen in the past.
It comes after research carried out by the Council of Mortgage Lenders (CML) found that home buyer borrowing reached its highest level for a decade in the first two months of 2017.
The CML credited the increase to strong first-time buyer activity, which has consistently matched home mover borrowing over the past six months and is expected to continue for the rest of 2017 and beyond.
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