There’ll be a distinct lack of options for >=90% LTV people, as the risk has just jumped massively.
The market will contract (unless Sunak changes Stamp Duty?) as the recession takes hold and many, many people will be left in negative equity (2/5 houses sold in Northern Ireland since 2008 are in an average of £68k of negative equity) making it nigh-on impossible for them to remortgage.
The Government won’t want this, as they will need people to spend to beat the recession, so (IMO) affordability rules will be relaxed for “mortgage prisoners” (not home movers) to enable people to stay in their houses. In order to do this, money will need to be made available, cheaply, on the markets.
So maybe those >=90% LTV mortgages will be there, just with 20% underwritten by Government, as is the case for some people in Northern Ireland.
Following the 2008 crash (and this is far, far worse), rates stayed at 0.5% until mid-2016, when they dropped further, to 0.25%.
They increased to 0.5% in 2017, where they remained for a while, before going up to 0.75%, as the economy started to show real signs of improvement.
You won’t see much movement in 2 year fixes, maybe an increase in product fees, lack of availability in products without fees.
The movement will be in 3 to 5 year fixes, they’ll be about the same as where they are now, perhaps slightly lower, with options for fees, or no fees.
Banks will want to get the revenue from a longer term and to feel safe that you’re not going to default.
An average 5 years fixed on 80% LTV is about 0.99% above the Base Rate, of 0.75%.
I cannot foresee it dropping to 1.09% for an 80% LTV 5 year fixed, with the new rate of 0.1%.
People on a discounted tracker will be loving it.
@gingerbongo - You’ve made a hedge there with your extension, based on market conditions at the time.
Now those market conditions have changed, I hope the value of your home hasn’t fallen, making the LTV the same it was before you had the extension done