Barclays, Halifax, HSBC and TSB hike rates by up to 20bps – Mortgage Strategy
Major lenders including Barclays, Halifax, HSBC, TSB and Skipton are raising rates by up to 20 basis points tomorrow.
In the first few hours of business, many of the largest lenders have emailed brokers to notify them of the latest rate increases, including to tracker deals.
Barclays is raising prices on scores of residential products including deals for purchase, remortgage and product transfers, many of which are between 15 and 19bps.
But some of the steepest increases are to existing mortgage customer (EMC) Reward deals, with a five-year tracker product at 85% LTV climbing 20bps, from 4.55% to 4.75%.
Barclays’ EMC Reward two-year fixed product at 70% LTV with a £1,999 fee will also go up by 20bps, from 4.76% to 4.96%.
Halifax is putting up prices on all two, three and five-year fixed rates for home movers and first time buyers by up to 20bps tomorrow.
Two-year trackers will rise by up to 10bps for both purchase and remortgage customers.
TSB is also raising selected residential rates by up to 20bps tomorrow and buy-to-let rates by up to 15bps.
For landlords, BM Solutions is raising rates by up to 19bps tomorrow.
HSBC is putting up its prices tomorrow, however it does not give brokers advance warning of the scale of the changes.
Skipton Building Society has also announced it is hiking costs tomorrow and has published its new products on its intermediary website already.
John Charcol mortgage technical manager Nicholas Mendes says: “Six major lenders have moved on price today.
“To put [the changes] in context, a 20bps increase on a typical £200,000 mortgage over 25 years adds around £23 a month, or roughly £276 a year.
“On a £300,000 mortgage the same increase adds closer to £35 a month, nearly £420 a year.
“It’s not a dramatic jump on its own, but it’s the third or fourth such move in a matter of weeks, and each one stacks on the last for anyone still shopping around.
“None of this is surprising. Swaps have been climbing since the Middle East escalated, with two-year SONIA up from 3.978% a month ago to 4.177% today and five-year from 4.008% to 4.231%.”
Mendes warns that borrowers should brace for further repricing.
He says: “When a lender as prominent as Halifax moves, the rest of the market tends to fall in line within days.
“June’s CPI lands Wednesday and is expected to ease to around 2.6%, but I wouldn’t read too much into it.
“The energy price cap rise will start showing up in July’s figures, and the war in Iran is still very much live, so any relief here is likely to be short-lived.
“The Bank of England meets the following week on 30 July, and the vote split has been drifting hawkish, with two members already backing an immediate hike to 4%.
“My money’s still on a hold, but the debate inside the MPC tells you which way the risk is skewed, and a rise, at this meeting or the one in September, looks more likely than a cut.”
Trinity Financial product and communications director Aaron Strutt says: “This Halifax rate change probably means that Lloyds will be pushing up its cheap fixes as well, which undercut virtually all of the other lenders by quite some margin
“Halifax has a decent 4.33% two-year fix and a 4.37% five-year fix available until close of business today.
“We are starting to see most of the lenders raising their fixes and Halifax is even making its trackers more expensive which means it will no longer off a sub-4% variable rate deals.
“We can probably expect a few more rate changes over the next few days, so it is unlikely to be worth holding off booking a rate if you are buying somewhere or remortgaging.
“The continuation of the war in Iran is not good news for many reasons, and it certainly does not help bring any calm to the money markets.”
