The average mortgage rate across the mortgages in our “rate basket” has reduced this week from 1.42% to 1.40%. This is a little disappointing, given that many lenders have been publicising mortgage rate reductions following the “re-opening” of the mortgage market.

Coincidentally, the average rate across the rate basket was 1.40% immediately prior to the fall in Bank of England base rate from 0.75% to 0.10% – a reduction of 0.65%. So it doesn’t seem that the reduction in base rate has been reflected in the mortgage rates that are being offered to the clients of banks and building societies.

A comparison of the individual rates within the rate baskets prior to the base rate cut and now indicates that higher loan to value product rates have increased or remain the same whereas lower loan to value rates have reduced. This would indicate that lenders are perceiving greater risk at the moment.

We’ll see what happens over the coming weeks.