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Yorkshire Building Society has become the latest lender to confirm it will cut mortgage rates, with full details to be announced next week.

It comes after HSBC unveiled reductions to its range on Wednesday, including a five-year deal below 4%.

First Direct, a division of HSBC, is also expected to announce mortgage rate cuts on Friday – and experts predict more lenders will soon follow.

A spokesperson for the Yorkshire Building Society told Sky News: “We’ll be announcing rate cuts across our range next week, taking advantage of recent falls in market rates to continue passing on as much value as possible to borrowers.”

It comes amid expectations the Bank of England will cut interest rates this year as inflation falls – read more on that from Ian King in our 6.43 post.

The state of the UK housing market as we enter 2024 – and what experts predict for the next 12 months

You won’t need to look any further than our Money blog for housing market updates through 2024 – and we thought we’d start by giving you an overview of what happened in 2023 and what the industry expects to happen this year.

Some stats on 2023

• Average property prices ended down 1.8% during 2023, according to Nationwide – that’s almost 4.5% below the all-time high recorded in late summer 2022;
• The average property price ended the year at £257,443, they say;
• The average time to sell a property, according to Zoopla, was 34 days – up from 25 days in 2022;
• Three bed homes remained the most in-demand property type.

Most viewed homes for sale on Zoopla

Seven out of the top 10 most searched homes in 2023 were doer-uppers.

The most viewed homes for sale in 2023 were this two-bed flat at Leyton Orient Football Ground (listed at £350,000) and this two-bed terrace (up for £25,000, which explains it) in Liverpool.

Cheapest (and most expensive) places to buy

Northern Ireland and Scotland were the only parts of the UK to see prices rise in 2023, according to Nationwide. East Anglia was the weakest performing region with prices down 5.2% over the year.

Inverclyde takes the top spot as the cheapest local authority in the UK with an average house price of £103,200, according to Zoopla. Unsurprisingly, Kensington and Chelsea in London is the most expensive local authority in the UK with an average house price 10 times the amount of a house in Inverclyde, at £1,209,100.

What’s happening with mortgages?

There has been some positive news on this front over the last few weeks.

HSBC today became the latest lender to cut mortgage rates amid predictions that more banks and building societies will follow suit in the coming weeks.

The deals include a two-year fixed re-mortgage rate of 4.49% and a five-year deal of 3.94%. They’re the first major lender to dip back below the landmark 4%.

It comes after Halifax, the UK’s largest mortgage provider, reduced its rates by up to 0.83 percentage points on Tuesday, including a two-year deal of 4.68% with a £999 fee.

Predictions for 2024

Zoopla predicts house price growth will remain negative with prices down 2%.

Nationwide offered a similar sentiment: “There have been some encouraging signs for potential buyers recently, with mortgage rates edging down. 

“Investors have become more optimistic that the Bank of England has already raised rates far enough to return inflation to target and will reduce rates in the years ahead. This shift in view is important, as it has brought down longer-term interest rates, which underpin fixed mortgage rate pricing.

“Nevertheless, a rapid rebound in activity or house prices in 2024 appears unlikely. Consumer confidence remains weak and surveyors continue to report subdued levels of new buyer enquiries. 

“We expect, house prices are likely to record another small decline or remain broadly flat (perhaps 0 to -2%) over the course of 2024.”

First-time buyers are predicted to be the largest group of would-be buyers in 2024 (40%), Zoopla says.