Three significant mortgage lenders have lowered their headline fixed rates once more, bringing the cost of house loans down to a level not seen since before Liz Truss's mini-Budget.

With revised rates taking effect tomorrow, TSB was the first off the blocks, cutting up to 0.25% off its two, three, and five year packages for homeowners and first-time purchasers.

Rivals Barclays and HSBC quickly followed suit, launching a full-scale price war that is beginning to revitalize the real estate market.

The decreases coincide with the ongoing downward drift of the City wholesale market swap rates, which determine the cost of fixed rate mortgages, in anticipation of further interest rate cuts by the Bank of England, following a 0.25% decline earlier this month.
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Barclays trimmed 0.15% off many of its deals, including a two year fixed rate deal for borrowers with only a 15% deposit. The rate came down from 5.22% to 5.07%.

HSBC said it will be making reductions to its two, three and five year fixed products on LTVs ranging from 60% to 90% from tomorrow, although it did not specify how big they would be.

In addition Virgin Money cut 0.15% off its buy to let mortgage rates.

Ben Perks, managing director at Orchard Financial Advisers, said: “Swap rates continue to trickle downward so hopefully more cuts are on the way as we head into the Bank Holiday weekend.”

Justin Moy, Managing Director at EHF Mortgages said: “Further cuts to mortgage rates will be welcome news for borrowers, as the market looks to encourage more activity for homebuyers and first-time buyers, improving affordability and keeping the property wheel spinning.

.Katy Eatenton, Mortgage & Protection Specialist at Lifetime Wealth Management said: “Lenders are definitely doing their best to make August one of the busiest yet.

“Three major lenders announcing more rate cuts is keeping the market moving in the right direction, even if another base rate card reduction is off the cards in September.”

Ranald Mitchell, Director at Charwin Mortgages said “With lenders battling it out, borrowers and the property market are set to benefit from this relentless momentum. The race is on, and it’s shaping up to be an exciting end to the year for anyone looking to secure a great mortgage deal.”