The total number of mortgage products available reached a post-recession high of 13,539 in April.
The latest National Mortgage Index from Mortgage Advice Bureau found that a year on from the Mortgage Market Review (MMR), the number of mortgage products has increased by 19% since April 2014.
Mortgage products available through intermediaries in particular have risen significantly over the past year, up from 7,942 in April 2014 to 9,309, an increase of 1,367.
Mortgage rates have been falling steadily over the past six months, and April’s Index suggests these are yet to have hit the bottom of the curve.
Average two year fixed rates fell below 3% for the first time in April and both three and five year fixed rates have never been lower, according to data from Moneyfacts.co.uk.
“Consumers have been benefiting from record low mortgage rates for some time now, and product availability has continued to improve. A low interest rate environment – plus extra initiatives such as stamp duty reform – has certainly helped to make affordability conditions better for consumers, despite the Mortgage Market Review,” says Brian Murphy, head of lending at Mortgage Advice Bureau.
“However, while mortgage products are certainly now more competitively priced, borrowers will find they are paying a greater premium for the security of a five-year fix. With an interest rate rise forecast for 2016, it’s unsurprising that lenders are building in this cushion to longer-term fixed products to avoid under-pricing in the long run,” he adds.
There was a small slowdown in mortgage applications in April, according to the report, with total cases down by 10% compared to March.
Mortgage Advice Bureau says this was partly attributable to the Easter break at the beginning of the month, and total mortgage applications remain 22% higher year-on-year.
“Consumer demand is certainly riding high, but our major concern is that housing supply is running dangerously low. The UK is short of enough suitable properties to support potential buyers’ homeowning aspirations, and a housing strategy that will last beyond the current government is desperately needed,” Murphy added.